542019.BO WACC - Weighted Average Cost of Capital

The WACC of Shubham Polyspin Ltd (542019.BO) is 12.1%.

The Cost of Equity of Shubham Polyspin Ltd (542019.BO) is 13.90%.

The Cost of Debt of Shubham Polyspin Ltd (542019.BO) is 10.05%.

	Range	Selected
Cost of equity	11.30% - 16.50%	13.90%
Tax rate	28.00% - 29.10%	28.55%
Cost of debt	9.60% - 10.50%	10.05%
WACC	10.1% - 14.0%	12.1%

WACC

542019.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.53	0.92

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.30%	16.50%

Tax rate	28.00%	29.10%
Debt/Equity ratio	0.37	0.37
Cost of debt	9.60%	10.50%

After-tax WACC	10.1%	14.0%


Selected WACC	12.1%

542019.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 542019.BO:

cost_of_equity (13.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.53) + 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.