BOSCHLTD.NS WACC - Weighted Average Cost of Capital

The WACC of Bosch Ltd (BOSCHLTD.NS) is 15.6%.

The Cost of Equity of Bosch Ltd (BOSCHLTD.NS) is 15.60%.

The Cost of Debt of Bosch Ltd (BOSCHLTD.NS) is 11.50%.

	Range	Selected
Cost of equity	13.50% - 17.70%	15.60%
Tax rate	20.60% - 22.80%	21.70%
Cost of debt	7.50% - 15.50%	11.50%
WACC	13.5% - 17.7%	15.6%

WACC

BOSCHLTD.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.79	1.05

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.50%	17.70%

Tax rate	20.60%	22.80%
Debt/Equity ratio	0	0
Cost of debt	7.50%	15.50%

After-tax WACC	13.5%	17.7%


Selected WACC	15.6%

BOSCHLTD.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 BOSCHLTD.NS:

cost_of_equity (15.60%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.79) + 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.