532102.BO WACC - Weighted Average Cost of Capital

The WACC of SBEC Sugar Ltd (532102.BO) is 16.1%.

The Cost of Equity of SBEC Sugar Ltd (532102.BO) is 16.40%.

The Cost of Debt of SBEC Sugar Ltd (532102.BO) is 18.90%.

	Range	Selected
Cost of equity	14.80% - 18.00%	16.40%
Tax rate	11.30% - 19.70%	15.50%
Cost of debt	13.90% - 23.90%	18.90%
WACC	13.6% - 18.6%	16.1%

WACC

532102.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.95	1.09

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.80%	18.00%

Tax rate	11.30%	19.70%
Debt/Equity ratio	0.96	0.96
Cost of debt	13.90%	23.90%

After-tax WACC	13.6%	18.6%


Selected WACC	16.1%

532102.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 532102.BO:

cost_of_equity (16.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.95) + 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.