530431.BO
Ador Fontech Ltd
Price:  
143.10 
INR
Volume:  
98,240.00
India | Machinery
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530431.BO WACC - Weighted Average Cost of Capital

The WACC of Ador Fontech Ltd (530431.BO) is 16.9%.

The Cost of Equity of Ador Fontech Ltd (530431.BO) is 16.90%.
The Cost of Debt of Ador Fontech Ltd (530431.BO) is 5.00%.

Range Selected
Cost of equity 15.50% - 18.30% 16.90%
Tax rate 32.00% - 34.90% 33.45%
Cost of debt 5.00% - 5.00% 5.00%
WACC 15.5% - 18.3% 16.9%
WACC

530431.BO WACC calculation

Category Low High
Long-term bond rate 6.9% 7.4%
Equity market risk premium 8.3% 9.3%
Adjusted beta 1.03 1.12
Additional risk adjustments 0.0% 0.5%
Cost of equity 15.50% 18.30%
Tax rate 32.00% 34.90%
Debt/Equity ratio 0 0
Cost of debt 5.00% 5.00%
After-tax WACC 15.5% 18.3%
Selected WACC 16.9%

530431.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 530431.BO:

cost_of_equity (16.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.03) + 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.