540590.BO WACC - Weighted Average Cost of Capital
The WACC of Riddhi Corporate Services Ltd (540590.BO) is 13.2%.
| Range | Selected | |
| Cost of equity | 20.9% - 25.9% | 23.4% |
| Tax rate | 24.8% - 28.0% | 26.4% |
| Cost of debt | 4.0% - 9.1% | 6.55% |
| WACC | 11.1% - 15.3% | 13.2% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 1.69 | 1.94 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 20.9% | 25.9% |
| Tax rate | 24.8% | 28.0% |
| Debt/Equity ratio | 1.21 | 1.21 |
| Cost of debt | 4.0% | 9.1% |
| After-tax WACC | 11.1% | 15.3% |
| Selected WACC | 13.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 540590.BO | Riddhi Corporate Services Ltd | 1.21 | 0.19 | 0.1 |
| 526433.BO | ASM Technologies Ltd | 0.03 | 0.64 | 0.63 |
| AIRAN.NS | Airan Ltd | 0.01 | 1.08 | 1.07 |
| ALANKIT.NS | Alankit Ltd | 0.1 | 1.51 | 1.4 |
| DATAMATICS.NS | Datamatics Global Services Ltd | 0 | 1.76 | 1.75 |
| GENESYS.NS | Genesys International Corporation Ltd | 0.05 | 1.8 | 1.74 |
| INFIBEAM.NS | Infibeam Avenues Ltd | 0 | 1.05 | 1.05 |
| ONEPOINT.NS | One Point One Solutions Ltd | 0.04 | 1.2 | 1.17 |
| VAKRANGEE.NS | Vakrangee Ltd | 0 | 0.54 | 0.53 |
| XCHANGING.NS | Xchanging Solutions Ltd | 0 | 1.44 | 1.44 |
| Low | High | |
| Unlevered beta | 1.06 | 1.26 |
| Relevered beta | 2.03 | 2.4 |
| Adjusted relevered beta | 1.69 | 1.94 |
540590.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 540590.BO:
cost_of_equity (23.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.69) + 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.