BIRLAMONEY.NS WACC - Weighted Average Cost of Capital

The WACC of Aditya Birla Money Ltd (BIRLAMONEY.NS) is 12.8%.

The Cost of Equity of Aditya Birla Money Ltd (BIRLAMONEY.NS) is 24.70%.

The Cost of Debt of Aditya Birla Money Ltd (BIRLAMONEY.NS) is 11.60%.

	Range	Selected
Cost of equity	21.70% - 27.70%	24.70%
Tax rate	26.30% - 26.90%	26.60%
Cost of debt	7.80% - 15.40%	11.60%
WACC	10.0% - 15.6%	12.8%

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	1.79	2.13

Additional risk adjustments	0.0%	0.5%
Cost of equity	21.70%	27.70%

Tax rate	26.30%	26.90%
Debt/Equity ratio	2.81	2.81
Cost of debt	7.80%	15.40%

After-tax WACC	10.0%	15.6%


Selected WACC	12.8%

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 (24.70%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.79) + 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.