540125.BO WACC - Weighted Average Cost of Capital

The WACC of Radhika Jeweltech Ltd (540125.BO) is 13.3%.

The Cost of Equity of Radhika Jeweltech Ltd (540125.BO) is 13.90%.

The Cost of Debt of Radhika Jeweltech Ltd (540125.BO) is 6.10%.

	Range	Selected
Cost of equity	12.60% - 15.20%	13.90%
Tax rate	24.90% - 31.90%	28.40%
Cost of debt	4.00% - 8.20%	6.10%
WACC	12.0% - 14.6%	13.3%

WACC

540125.BO WACC calculation

Category	Low	High

Long-term bond rate	7.5%	8.0%
Equity market risk premium	6.9%	7.9%
Adjusted beta	0.73	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.60%	15.20%

Tax rate	24.90%	31.90%
Debt/Equity ratio	0.06	0.06
Cost of debt	4.00%	8.20%

After-tax WACC	12.0%	14.6%


Selected WACC	13.3%

540125.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 540125.BO:

cost_of_equity (13.90%) = risk_free_rate (7.75%) + equity_risk_premium (7.40%) * adjusted_beta (0.73) + 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.