BAJAJELEC.NS
Bajaj Electricals Ltd
Price:  
675.25 
INR
Volume:  
46,359
India | Household Durables

BAJAJELEC.NS WACC - Weighted Average Cost of Capital

The WACC of Bajaj Electricals Ltd (BAJAJELEC.NS) is 15.3%.

The Cost of Equity of Bajaj Electricals Ltd (BAJAJELEC.NS) is 15.3%.
The Cost of Debt of Bajaj Electricals Ltd (BAJAJELEC.NS) is 16.9%.

RangeSelected
Cost of equity13.7% - 16.9%15.3%
Tax rate22.6% - 24.0%23.3%
Cost of debt9.1% - 24.7%16.9%
WACC13.6% - 16.9%15.3%
WACC

BAJAJELEC.NS WACC calculation

CategoryLowHigh
Long-term bond rate6.9%7.4%
Equity market risk premium8.3%9.3%
Adjusted beta0.830.97
Additional risk adjustments0.0%0.5%
Cost of equity13.7%16.9%
Tax rate22.6%24.0%
Debt/Equity ratio
0.030.03
Cost of debt9.1%24.7%
After-tax WACC13.6%16.9%
Selected WACC15.3%

BAJAJELEC.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 BAJAJELEC.NS:

cost_of_equity (15.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.83) + 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.