530697.BO WACC - Weighted Average Cost of Capital

The WACC of Zenlabs Ethica Ltd (530697.BO) is 11.2%.

The Cost of Equity of Zenlabs Ethica Ltd (530697.BO) is 13.25%.

The Cost of Debt of Zenlabs Ethica Ltd (530697.BO) is 11.30%.

	Range	Selected
Cost of equity	11.30% - 15.20%	13.25%
Tax rate	27.50% - 30.50%	29.00%
Cost of debt	10.50% - 12.10%	11.30%
WACC	9.8% - 12.5%	11.2%

WACC

530697.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.54	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.30%	15.20%

Tax rate	27.50%	30.50%
Debt/Equity ratio	0.66	0.66
Cost of debt	10.50%	12.10%

After-tax WACC	9.8%	12.5%


Selected WACC	11.2%

530697.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 530697.BO:

cost_of_equity (13.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.54) + 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.