BRIGHT.NS WACC - Weighted Average Cost of Capital

The WACC of Bright Solar Ltd (BRIGHT.NS) is 12.5%.

The Cost of Equity of Bright Solar Ltd (BRIGHT.NS) is 13.60%.

The Cost of Debt of Bright Solar Ltd (BRIGHT.NS) is 5.95%.

	Range	Selected
Cost of equity	11.60% - 15.60%	13.60%
Tax rate	9.60% - 24.80%	17.20%
Cost of debt	4.30% - 7.60%	5.95%
WACC	10.7% - 14.4%	12.5%

WACC

BRIGHT.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.57	0.83

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.60%	15.60%

Tax rate	9.60%	24.80%
Debt/Equity ratio	0.14	0.14
Cost of debt	4.30%	7.60%

After-tax WACC	10.7%	14.4%


Selected WACC	12.5%

BRIGHT.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 BRIGHT.NS:

cost_of_equity (13.60%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.57) + 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.