526731.BO WACC - Weighted Average Cost of Capital

The WACC of Bright Brothers Ltd (526731.BO) is 15.3%.

The Cost of Equity of Bright Brothers Ltd (526731.BO) is 15.55%.

The Cost of Debt of Bright Brothers Ltd (526731.BO) is 19.15%.

	Range	Selected
Cost of equity	13.90% - 17.20%	15.55%
Tax rate	21.80% - 27.80%	24.80%
Cost of debt	10.50% - 27.80%	19.15%
WACC	12.7% - 17.8%	15.3%

WACC

526731.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.84	1.01

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.90%	17.20%

Tax rate	21.80%	27.80%
Debt/Equity ratio	0.26	0.26
Cost of debt	10.50%	27.80%

After-tax WACC	12.7%	17.8%


Selected WACC	15.3%

526731.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 526731.BO:

cost_of_equity (15.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.84) + 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.