BALMLAWRIE.NS WACC - Weighted Average Cost of Capital

The WACC of Balmer Lawrie and Company Ltd (BALMLAWRIE.NS) is 14.0%.

The Cost of Equity of Balmer Lawrie and Company Ltd (BALMLAWRIE.NS) is 14.25%.

The Cost of Debt of Balmer Lawrie and Company Ltd (BALMLAWRIE.NS) is 12.20%.

	Range	Selected
Cost of equity	12.70% - 15.80%	14.25%
Tax rate	31.40% - 33.50%	32.45%
Cost of debt	7.60% - 16.80%	12.20%
WACC	12.4% - 15.6%	14.0%

WACC

BALMLAWRIE.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	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.70%	15.80%

Tax rate	31.40%	33.50%
Debt/Equity ratio	0.04	0.04
Cost of debt	7.60%	16.80%

After-tax WACC	12.4%	15.6%


Selected WACC	14.0%

BALMLAWRIE.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 BALMLAWRIE.NS:

cost_of_equity (14.25%) = 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.