531540.BO WACC - Weighted Average Cost of Capital

The WACC of Maruti Infrastructure Ltd (531540.BO) is 12.3%.

The Cost of Equity of Maruti Infrastructure Ltd (531540.BO) is 12.70%.

The Cost of Debt of Maruti Infrastructure Ltd (531540.BO) is 16.15%.

	Range	Selected
Cost of equity	10.80% - 14.60%	12.70%
Tax rate	30.10% - 33.80%	31.95%
Cost of debt	8.40% - 23.90%	16.15%
WACC	9.7% - 14.8%	12.3%

WACC

531540.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.47	0.72

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.80%	14.60%

Tax rate	30.10%	33.80%
Debt/Equity ratio	0.28	0.28
Cost of debt	8.40%	23.90%

After-tax WACC	9.7%	14.8%


Selected WACC	12.3%

531540.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 531540.BO:

cost_of_equity (12.70%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.47) + 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.