542057.BO WACC - Weighted Average Cost of Capital

The WACC of BCPL Railway Infrastructure Ltd (542057.BO) is 17.2%.

The Cost of Equity of BCPL Railway Infrastructure Ltd (542057.BO) is 16.05%.

The Cost of Debt of BCPL Railway Infrastructure Ltd (542057.BO) is 28.15%.

	Range	Selected
Cost of equity	14.00% - 18.10%	16.05%
Tax rate	27.00% - 27.50%	27.25%
Cost of debt	8.10% - 48.20%	28.15%
WACC	11.9% - 22.5%	17.2%

WACC

542057.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.86	1.1

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.00%	18.10%

Tax rate	27.00%	27.50%
Debt/Equity ratio	0.35	0.35
Cost of debt	8.10%	48.20%

After-tax WACC	11.9%	22.5%


Selected WACC	17.2%

542057.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 542057.BO:

cost_of_equity (16.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.86) + 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.