539018.BO WACC - Weighted Average Cost of Capital

The WACC of Beekay Steel Industries Ltd (539018.BO) is 15.5%.

The Cost of Equity of Beekay Steel Industries Ltd (539018.BO) is 18.35%.

The Cost of Debt of Beekay Steel Industries Ltd (539018.BO) is 6.85%.

	Range	Selected
Cost of equity	16.50% - 20.20%	18.35%
Tax rate	22.90% - 24.90%	23.90%
Cost of debt	5.80% - 7.90%	6.85%
WACC	13.9% - 17.1%	15.5%

WACC

539018.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.16	1.32

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.50%	20.20%

Tax rate	22.90%	24.90%
Debt/Equity ratio	0.28	0.28
Cost of debt	5.80%	7.90%

After-tax WACC	13.9%	17.1%


Selected WACC	15.5%

539018.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 539018.BO:

cost_of_equity (18.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.16) + 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.