526727.BO WACC - Weighted Average Cost of Capital

The WACC of Garnet Construction Ltd (526727.BO) is 11.2%.

The Cost of Equity of Garnet Construction Ltd (526727.BO) is 12.85%.

The Cost of Debt of Garnet Construction Ltd (526727.BO) is 7.40%.

	Range	Selected
Cost of equity	10.50% - 15.20%	12.85%
Tax rate	28.30% - 28.70%	28.50%
Cost of debt	7.30% - 7.50%	7.40%
WACC	9.3% - 13.0%	11.2%

WACC

526727.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.43	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.50%	15.20%

Tax rate	28.30%	28.70%
Debt/Equity ratio	0.28	0.28
Cost of debt	7.30%	7.50%

After-tax WACC	9.3%	13.0%


Selected WACC	11.2%

526727.BO's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for 526727.BO:

cost_of_equity (12.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.43) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.