AVTNPL.NS WACC - Weighted Average Cost of Capital

The WACC of AVT Natural Products Ltd (AVTNPL.NS) is 15.7%.

The Cost of Equity of AVT Natural Products Ltd (AVTNPL.NS) is 16.35%.

The Cost of Debt of AVT Natural Products Ltd (AVTNPL.NS) is 12.45%.

	Range	Selected
Cost of equity	14.50% - 18.20%	16.35%
Tax rate	24.90% - 25.10%	25.00%
Cost of debt	7.80% - 17.10%	12.45%
WACC	13.7% - 17.7%	15.7%

WACC

AVTNPL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.92	1.11

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.50%	18.20%

Tax rate	24.90%	25.10%
Debt/Equity ratio	0.11	0.11
Cost of debt	7.80%	17.10%

After-tax WACC	13.7%	17.7%


Selected WACC	15.7%

AVTNPL.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 AVTNPL.NS:

cost_of_equity (16.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.92) + 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.