540360.BO WACC - Weighted Average Cost of Capital

The WACC of Leading Leasing Finance and Investment Company Ltd (540360.BO) is 9.8%.

The Cost of Equity of Leading Leasing Finance and Investment Company Ltd (540360.BO) is 11.50%.

The Cost of Debt of Leading Leasing Finance and Investment Company Ltd (540360.BO) is 5.80%.

	Range	Selected
Cost of equity	10.60% - 12.40%	11.50%
Tax rate	26.30% - 26.50%	26.40%
Cost of debt	4.00% - 7.60%	5.80%
WACC	8.8% - 10.7%	9.8%

WACC

540360.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.45	0.48

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.60%	12.40%

Tax rate	26.30%	26.50%
Debt/Equity ratio	0.31	0.31
Cost of debt	4.00%	7.60%

After-tax WACC	8.8%	10.7%


Selected WACC	9.8%

540360.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 540360.BO:

cost_of_equity (11.50%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.45) + 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.