531215.BO WACC - Weighted Average Cost of Capital

The WACC of Rts Power Corporation Ltd (531215.BO) is 15.4%.

The Cost of Equity of Rts Power Corporation Ltd (531215.BO) is 16.75%.

The Cost of Debt of Rts Power Corporation Ltd (531215.BO) is 14.05%.

	Range	Selected
Cost of equity	14.10% - 19.40%	16.75%
Tax rate	33.70% - 40.00%	36.85%
Cost of debt	9.10% - 19.00%	14.05%
WACC	12.8% - 18.1%	15.4%

WACC

531215.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.87	1.24

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.10%	19.40%

Tax rate	33.70%	40.00%
Debt/Equity ratio	0.2	0.2
Cost of debt	9.10%	19.00%

After-tax WACC	12.8%	18.1%


Selected WACC	15.4%

531215.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 531215.BO:

cost_of_equity (16.75%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.87) + 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.