532406.BO WACC - Weighted Average Cost of Capital
The WACC of Avantel Ltd (532406.BO) is 13.1%.
| Range | Selected | |
| Cost of equity | 11.8% - 14.5% | 13.15% |
| Tax rate | 18.9% - 22.6% | 20.75% |
| Cost of debt | 7.5% - 28.7% | 18.1% |
| WACC | 11.7% - 14.5% | 13.1% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.59 | 0.71 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.8% | 14.5% |
| Tax rate | 18.9% | 22.6% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 7.5% | 28.7% |
| After-tax WACC | 11.7% | 14.5% |
| Selected WACC | 13.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 532406.BO | Avantel Ltd | 0 | 1.18 | 1.18 |
| 028080.KQ | Humax Holdings Co Ltd | 7.16 | 0.69 | 0.1 |
| 1613.HK | Synertone Communication Corp | 0.38 | 0.08 | 0.06 |
| 517258.BO | Precision Electronics Ltd | 0.12 | 0.64 | 0.58 |
| 526775.BO | Valiant Communications Ltd | 0 | 1.05 | 1.05 |
| 532975.BO | Aishwarya Technologies and Telecom Ltd | 0.09 | 0.58 | 0.55 |
| MRO-TEK.NS | MRO-TEK Reality Ltd | 1.02 | 0.75 | 0.41 |
| SMARTLINK.NS | Smartlink Holdings Ltd | 0.22 | 1.14 | 0.97 |
| TNTELE.NS | Tamilnadu Telecommunication Ltd | 0.78 | 0.32 | 0.2 |
| TST.VN | Telecommunication Technical Service JSC | 0.73 | 0.25 | 0.16 |
| Low | High | |
| Unlevered beta | 0.33 | 0.56 |
| Relevered beta | 0.39 | 0.57 |
| Adjusted relevered beta | 0.59 | 0.71 |
532406.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 532406.BO:
cost_of_equity (13.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.59) + 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.