BALKRISHNA.NS WACC - Weighted Average Cost of Capital

The WACC of Balkrishna Paper Mills Ltd (BALKRISHNA.NS) is 8.3%.

The Cost of Equity of Balkrishna Paper Mills Ltd (BALKRISHNA.NS) is 14.45%.

The Cost of Debt of Balkrishna Paper Mills Ltd (BALKRISHNA.NS) is 5.50%.

	Range	Selected
Cost of equity	12.70% - 16.20%	14.45%
Tax rate	0.20% - 0.50%	0.35%
Cost of debt	4.00% - 7.00%	5.50%
WACC	6.8% - 9.9%	8.3%

WACC

BALKRISHNA.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.7	0.89

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.70%	16.20%

Tax rate	0.20%	0.50%
Debt/Equity ratio	2.13	2.13
Cost of debt	4.00%	7.00%

After-tax WACC	6.8%	9.9%


Selected WACC	8.3%

BALKRISHNA.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 BALKRISHNA.NS:

cost_of_equity (14.45%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.7) + 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.