530233.BO WACC - Weighted Average Cost of Capital

The WACC of Auro Laboratories Ltd (530233.BO) is 13.1%.

The Cost of Equity of Auro Laboratories Ltd (530233.BO) is 13.55%.

The Cost of Debt of Auro Laboratories Ltd (530233.BO) is 14.45%.

	Range	Selected
Cost of equity	12.40% - 14.70%	13.55%
Tax rate	27.50% - 28.50%	28.00%
Cost of debt	7.90% - 21.00%	14.45%
WACC	11.4% - 14.7%	13.1%

WACC

530233.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.67	0.73

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.40%	14.70%

Tax rate	27.50%	28.50%
Debt/Equity ratio	0.18	0.18
Cost of debt	7.90%	21.00%

After-tax WACC	11.4%	14.7%


Selected WACC	13.1%

530233.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 530233.BO:

cost_of_equity (13.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.67) + 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.