539151.BO WACC - Weighted Average Cost of Capital

The WACC of Arfin India Ltd (539151.BO) is 13.7%.

The Cost of Equity of Arfin India Ltd (539151.BO) is 13.90%.

The Cost of Debt of Arfin India Ltd (539151.BO) is 13.20%.

	Range	Selected
Cost of equity	12.30% - 15.50%	13.90%
Tax rate	9.60% - 13.30%	11.45%
Cost of debt	12.10% - 14.30%	13.20%
WACC	12.2% - 15.2%	13.7%

WACC

539151.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.65	0.82

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.30%	15.50%

Tax rate	9.60%	13.30%
Debt/Equity ratio	0.09	0.09
Cost of debt	12.10%	14.30%

After-tax WACC	12.2%	15.2%


Selected WACC	13.7%

539151.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 539151.BO:

cost_of_equity (13.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.65) + 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.