540955.BO
Tasty Dairy Specialities Ltd
Price:  
9.10 
INR
Volume:  
3,580.00
India | Food Products
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540955.BO WACC - Weighted Average Cost of Capital

The WACC of Tasty Dairy Specialities Ltd (540955.BO) is 9.5%.

The Cost of Equity of Tasty Dairy Specialities Ltd (540955.BO) is 19.75%.
The Cost of Debt of Tasty Dairy Specialities Ltd (540955.BO) is 8.95%.

Range Selected
Cost of equity 13.30% - 26.20% 19.75%
Tax rate 25.50% - 26.80% 26.15%
Cost of debt 7.00% - 10.90% 8.95%
WACC 7.0% - 12.0% 9.5%
WACC

540955.BO WACC calculation

Category Low High
Long-term bond rate 6.9% 7.4%
Equity market risk premium 8.3% 9.3%
Adjusted beta 0.78 1.96
Additional risk adjustments 0.0% 0.5%
Cost of equity 13.30% 26.20%
Tax rate 25.50% 26.80%
Debt/Equity ratio 3.53 3.53
Cost of debt 7.00% 10.90%
After-tax WACC 7.0% 12.0%
Selected WACC 9.5%

540955.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 540955.BO:

cost_of_equity (19.75%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.78) + 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.