The WACC of Astrazeneca Pharma India Ltd (ASTRAZEN.NS) is 15.3%.
Range | Selected | |
Cost of equity | 14.2% - 16.4% | 15.3% |
Tax rate | 26.2% - 26.5% | 26.35% |
Cost of debt | 7.5% - 7.9% | 7.7% |
WACC | 14.2% - 16.4% | 15.3% |
Category | Low | High |
Long-term bond rate | 6.9% | 7.4% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 0.88 | 0.91 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 14.2% | 16.4% |
Tax rate | 26.2% | 26.5% |
Debt/Equity ratio | 0 | 0 |
Cost of debt | 7.5% | 7.9% |
After-tax WACC | 14.2% | 16.4% |
Selected WACC | 15.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
ASTRAZEN.NS | Astrazeneca Pharma India Ltd | 0 | 0.84 | 0.84 |
AARTIDRUGS.NS | Aarti Drugs Ltd | 0.15 | 1.04 | 0.94 |
AMRUTANJAN.NS | Amrutanjan Health Care Ltd | 0 | 0.86 | 0.86 |
ERIS.NS | Eris Lifesciences Ltd | 0.13 | 0.82 | 0.75 |
JBCHEPHARM.NS | J B Chemicals and Pharmaceuticals Ltd | 0.01 | 0.67 | 0.67 |
NOVARTIND.NS | Novartis India Ltd | 0.01 | 0.88 | 0.88 |
ORCHPHARMA.NS | Orchid Pharma Ltd | 0.04 | 1.31 | 1.27 |
PGHL.NS | Procter & Gamble Health Ltd | 0 | 0.78 | 0.78 |
SEQUENT.NS | SeQuent Scientific Ltd | 0.1 | 1.77 | 1.65 |
SUVENPHAR.NS | Suven Pharmaceuticals Ltd | 0 | 0.65 | 0.65 |
Low | High | |
Unlevered beta | 0.82 | 0.87 |
Relevered beta | 0.82 | 0.87 |
Adjusted relevered beta | 0.88 | 0.91 |
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 ASTRAZEN.NS:
cost_of_equity (15.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.88) + 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.