531449.BO
GRM Overseas Ltd
Price:  
381 
INR
Volume:  
57,546
India | Food Products

531449.BO WACC - Weighted Average Cost of Capital

The WACC of GRM Overseas Ltd (531449.BO) is 13.4%.

The Cost of Equity of GRM Overseas Ltd (531449.BO) is 14.55%.
The Cost of Debt of GRM Overseas Ltd (531449.BO) is 7.05%.

RangeSelected
Cost of equity13.1% - 16.0%14.55%
Tax rate26.9% - 30.7%28.8%
Cost of debt5.5% - 8.6%7.05%
WACC12.0% - 14.8%13.4%
WACC

531449.BO WACC calculation

CategoryLowHigh
Long-term bond rate7.3%7.8%
Equity market risk premium6.9%7.9%
Adjusted beta0.840.98
Additional risk adjustments0.0%0.5%
Cost of equity13.1%16.0%
Tax rate26.9%30.7%
Debt/Equity ratio
0.130.13
Cost of debt5.5%8.6%
After-tax WACC12.0%14.8%
Selected WACC13.4%

531449.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 531449.BO:

cost_of_equity (14.55%) = risk_free_rate (7.55%) + equity_risk_premium (7.40%) * adjusted_beta (0.84) + 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.