530127.BO WACC - Weighted Average Cost of Capital

The WACC of NPR Finance Ltd (530127.BO) is 12.8%.

The Cost of Equity of NPR Finance Ltd (530127.BO) is 12.90%.

The Cost of Debt of NPR Finance Ltd (530127.BO) is 16.55%.

	Range	Selected
Cost of equity	11.50% - 14.30%	12.90%
Tax rate	24.70% - 26.80%	25.75%
Cost of debt	8.30% - 24.80%	16.55%
WACC	10.5% - 15.0%	12.8%

WACC

530127.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.56	0.69

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.50%	14.30%

Tax rate	24.70%	26.80%
Debt/Equity ratio	0.24	0.24
Cost of debt	8.30%	24.80%

After-tax WACC	10.5%	15.0%


Selected WACC	12.8%

530127.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 530127.BO:

cost_of_equity (12.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.56) + 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.