532005.BO WACC - Weighted Average Cost of Capital

The WACC of Sam Industries Ltd (532005.BO) is 17.3%.

The Cost of Equity of Sam Industries Ltd (532005.BO) is 12.45%.

The Cost of Debt of Sam Industries Ltd (532005.BO) is 38.00%.

	Range	Selected
Cost of equity	10.60% - 14.30%	12.45%
Tax rate	16.40% - 20.30%	18.35%
Cost of debt	9.10% - 66.90%	38.00%
WACC	9.8% - 24.9%	17.3%

WACC

532005.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.45	0.69

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.60%	14.30%

Tax rate	16.40%	20.30%
Debt/Equity ratio	0.37	0.37
Cost of debt	9.10%	66.90%

After-tax WACC	9.8%	24.9%


Selected WACC	17.3%

532005.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 532005.BO:

cost_of_equity (12.45%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.45) + 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.