530879.BO WACC - Weighted Average Cost of Capital

The WACC of Capital India Finance Ltd (530879.BO) is 13.7%.

The Cost of Equity of Capital India Finance Ltd (530879.BO) is 10.75%.

The Cost of Debt of Capital India Finance Ltd (530879.BO) is 25.70%.

	Range	Selected
Cost of equity	9.80% - 11.70%	10.75%
Tax rate	16.70% - 34.20%	25.45%
Cost of debt	18.60% - 32.80%	25.70%
WACC	12.0% - 15.4%	13.7%

WACC

530879.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.35	0.41

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.80%	11.70%

Tax rate	16.70%	34.20%
Debt/Equity ratio	0.61	0.61
Cost of debt	18.60%	32.80%

After-tax WACC	12.0%	15.4%


Selected WACC	13.7%

530879.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 530879.BO:

cost_of_equity (10.75%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.35) + 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.