539123.BO
VB Industries Ltd
Price:  
12.37 
INR
Volume:  
10,448
India | Diversified Financial Services

539123.BO WACC - Weighted Average Cost of Capital

The WACC of VB Industries Ltd (539123.BO) is 7.2%.

The Cost of Equity of VB Industries Ltd (539123.BO) is 10.4%.
The Cost of Debt of VB Industries Ltd (539123.BO) is 5%.

RangeSelected
Cost of equity9.5% - 11.3%10.4%
Tax rate20.0% - 23.1%21.55%
Cost of debt5.0% - 5.0%5%
WACC6.7% - 7.6%7.2%
WACC

539123.BO WACC calculation

CategoryLowHigh
Long-term bond rate6.9%7.4%
Equity market risk premium8.3%9.3%
Adjusted beta0.310.37
Additional risk adjustments0.0%0.5%
Cost of equity9.5%11.3%
Tax rate20.0%23.1%
Debt/Equity ratio
11
Cost of debt5.0%5.0%
After-tax WACC6.7%7.6%
Selected WACC7.2%

539123.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 539123.BO:

cost_of_equity (10.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.31) + 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.