ALPA.NS WACC - Weighted Average Cost of Capital

The WACC of Alpa Laboratories Ltd (ALPA.NS) is 14.7%.

The Cost of Equity of Alpa Laboratories Ltd (ALPA.NS) is 14.70%.

The Cost of Debt of Alpa Laboratories Ltd (ALPA.NS) is 24.40%.

	Range	Selected
Cost of equity	13.40% - 16.00%	14.70%
Tax rate	25.10% - 29.90%	27.50%
Cost of debt	7.50% - 41.30%	24.40%
WACC	13.2% - 16.3%	14.7%

WACC

ALPA.NS 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	0.87

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.40%	16.00%

Tax rate	25.10%	29.90%
Debt/Equity ratio	0.02	0.02
Cost of debt	7.50%	41.30%

After-tax WACC	13.2%	16.3%


Selected WACC	14.7%

ALPA.NS'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 ALPA.NS:

cost_of_equity (14.70%) = 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.