530449.BO WACC - Weighted Average Cost of Capital

The WACC of Rungta Irrigation Ltd (530449.BO) is 13.6%.

The Cost of Equity of Rungta Irrigation Ltd (530449.BO) is 15.35%.

The Cost of Debt of Rungta Irrigation Ltd (530449.BO) is 7.35%.

	Range	Selected
Cost of equity	12.30% - 18.40%	15.35%
Tax rate	26.30% - 27.70%	27.00%
Cost of debt	6.90% - 7.80%	7.35%
WACC	11.0% - 16.1%	13.6%

WACC

530449.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.65	1.13

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.30%	18.40%

Tax rate	26.30%	27.70%
Debt/Equity ratio	0.21	0.21
Cost of debt	6.90%	7.80%

After-tax WACC	11.0%	16.1%


Selected WACC	13.6%

530449.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 530449.BO:

cost_of_equity (15.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.65) + 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.