AVTNPL.NS WACC - Weighted Average Cost of Capital

The WACC of AVT Natural Products Ltd (AVTNPL.NS) is 14.0%.

The Cost of Equity of AVT Natural Products Ltd (AVTNPL.NS) is 14.60%.

The Cost of Debt of AVT Natural Products Ltd (AVTNPL.NS) is 12.50%.

	Range	Selected
Cost of equity	13.40% - 15.80%	14.60%
Tax rate	24.90% - 25.10%	25.00%
Cost of debt	7.90% - 17.10%	12.50%
WACC	12.6% - 15.5%	14.0%

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	0.79	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.40%	15.80%

Tax rate	24.90%	25.10%
Debt/Equity ratio	0.13	0.13
Cost of debt	7.90%	17.10%

After-tax WACC	12.6%	15.5%


Selected WACC	14.0%

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 (14.60%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.79) + 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.