BDL.NS WACC - Weighted Average Cost of Capital

The WACC of Bharat Dynamics Ltd (BDL.NS) is 15.8%.

The Cost of Equity of Bharat Dynamics Ltd (BDL.NS) is 15.80%.

The Cost of Debt of Bharat Dynamics Ltd (BDL.NS) is 23.60%.

	Range	Selected
Cost of equity	14.30% - 17.30%	15.80%
Tax rate	26.40% - 26.70%	26.55%
Cost of debt	7.50% - 39.70%	23.60%
WACC	14.3% - 17.3%	15.8%

WACC

BDL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.9	1.02

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.30%	17.30%

Tax rate	26.40%	26.70%
Debt/Equity ratio	0	0
Cost of debt	7.50%	39.70%

After-tax WACC	14.3%	17.3%


Selected WACC	15.8%

BDL.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 BDL.NS:

cost_of_equity (15.80%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.9) + 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.