ARIHANTSUP.NS WACC - Weighted Average Cost of Capital

The WACC of Arihant Superstructures Ltd (ARIHANTSUP.NS) is 12.4%.

The Cost of Equity of Arihant Superstructures Ltd (ARIHANTSUP.NS) is 13.35%.

The Cost of Debt of Arihant Superstructures Ltd (ARIHANTSUP.NS) is 11.50%.

	Range	Selected
Cost of equity	10.40% - 16.30%	13.35%
Tax rate	17.90% - 18.90%	18.40%
Cost of debt	10.50% - 12.50%	11.50%
WACC	10.0% - 14.9%	12.4%

WACC

ARIHANTSUP.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.42	0.91

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.40%	16.30%

Tax rate	17.90%	18.90%
Debt/Equity ratio	0.3	0.3
Cost of debt	10.50%	12.50%

After-tax WACC	10.0%	14.9%


Selected WACC	12.4%

ARIHANTSUP.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 ARIHANTSUP.NS:

cost_of_equity (13.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.42) + 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.