BIRLAMONEY.NS WACC - Weighted Average Cost of Capital
The WACC of Aditya Birla Money Ltd (BIRLAMONEY.NS) is 12.5%.
| Range | Selected | |
| Cost of equity | 20.0% - 23.7% | 21.85% |
| Tax rate | 25.9% - 27.0% | 26.45% |
| Cost of debt | 7.1% - 12.1% | 9.6% |
| WACC | 10.7% - 14.3% | 12.5% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 1.58 | 1.7 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 20.0% | 23.7% |
| Tax rate | 25.9% | 27.0% |
| Debt/Equity ratio | 1.73 | 1.73 |
| Cost of debt | 7.1% | 12.1% |
| After-tax WACC | 10.7% | 14.3% |
| Selected WACC | 12.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| BIRLAMONEY.NS | Aditya Birla Money Ltd | 1.73 | 1.27 | 0.56 |
| 511768.BO | Master Trust Ltd | 0.11 | 0.99 | 0.92 |
| 530245.BO | Aryaman Financial Services Ltd | 0.07 | -0.55 | -0.52 |
| 531358.BO | Choice International Ltd | 0.09 | 0.91 | 0.85 |
| 537750.BO | Kiran Vyapar Ltd | 0.17 | 0.84 | 0.75 |
| 540192.BO | LKP Securities Ltd | 0.13 | 1.26 | 1.15 |
| 590082.BO | Lohia Securities Ltd | 0.01 | 0.87 | 0.87 |
| BLBLIMITED.NS | BLB Ltd | 0 | 1.46 | 1.45 |
| EMKAY.NS | Emkay Global Financial Services Ltd | 0.12 | 0.18 | 0.16 |
| PRIMESECU.NS | Prime Securities Ltd | 0 | 1.4 | 1.4 |
| Low | High | |
| Unlevered beta | 0.81 | 0.89 |
| Relevered beta | 1.87 | 2.04 |
| Adjusted relevered beta | 1.58 | 1.7 |
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 (21.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.58) + 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.