530131.BO WACC - Weighted Average Cost of Capital

The WACC of Udaipur Cement Works Ltd (530131.BO) is 13.9%.

The Cost of Equity of Udaipur Cement Works Ltd (530131.BO) is 16.75%.

The Cost of Debt of Udaipur Cement Works Ltd (530131.BO) is 11.75%.

	Range	Selected
Cost of equity	14.70% - 18.80%	16.75%
Tax rate	27.30% - 29.10%	28.20%
Cost of debt	10.40% - 13.10%	11.75%
WACC	12.2% - 15.6%	13.9%

WACC

530131.BO WACC calculation

Category	Low	High

Long-term bond rate	7.1%	7.6%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.92	1.16

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.70%	18.80%

Tax rate	27.30%	29.10%
Debt/Equity ratio	0.52	0.52
Cost of debt	10.40%	13.10%

After-tax WACC	12.2%	15.6%


Selected WACC	13.9%

530131.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 530131.BO:

cost_of_equity (16.75%) = risk_free_rate (7.35%) + equity_risk_premium (8.80%) * adjusted_beta (0.92) + 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.