BIRLAMONEY.NS WACC - Weighted Average Cost of Capital

The WACC of Aditya Birla Money Ltd (BIRLAMONEY.NS) is 12.3%.

The Cost of Equity of Aditya Birla Money Ltd (BIRLAMONEY.NS) is 21.75%.

The Cost of Debt of Aditya Birla Money Ltd (BIRLAMONEY.NS) is 9.70%.

	Range	Selected
Cost of equity	19.50% - 24.00%	21.75%
Tax rate	26.90% - 27.20%	27.05%
Cost of debt	7.30% - 12.10%	9.70%
WACC	10.4% - 14.3%	12.3%

WACC

BIRLAMONEY.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.52	1.73

Additional risk adjustments	0.0%	0.5%
Cost of equity	19.50%	24.00%

Tax rate	26.90%	27.20%
Debt/Equity ratio	1.78	1.78
Cost of debt	7.30%	12.10%

After-tax WACC	10.4%	14.3%


Selected WACC	12.3%

BIRLAMONEY.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 BIRLAMONEY.NS:

cost_of_equity (21.75%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.52) + 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.