BERGEPAINT.NS WACC - Weighted Average Cost of Capital

The WACC of Berger Paints India Ltd (BERGEPAINT.NS) is 14.8%.

The Cost of Equity of Berger Paints India Ltd (BERGEPAINT.NS) is 14.95%.

The Cost of Debt of Berger Paints India Ltd (BERGEPAINT.NS) is 6.30%.

	Range	Selected
Cost of equity	13.90% - 16.00%	14.95%
Tax rate	25.40% - 25.90%	25.65%
Cost of debt	5.10% - 7.50%	6.30%
WACC	13.8% - 15.9%	14.8%

WACC

BERGEPAINT.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.85	0.88

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.90%	16.00%

Tax rate	25.40%	25.90%
Debt/Equity ratio	0.01	0.01
Cost of debt	5.10%	7.50%

After-tax WACC	13.8%	15.9%


Selected WACC	14.8%

BERGEPAINT.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 BERGEPAINT.NS:

cost_of_equity (14.95%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.85) + 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.