BRNL.NS WACC - Weighted Average Cost of Capital

The WACC of Bharat Road Network Ltd (BRNL.NS) is 12.1%.

The Cost of Equity of Bharat Road Network Ltd (BRNL.NS) is 11.85%.

The Cost of Debt of Bharat Road Network Ltd (BRNL.NS) is 13.10%.

	Range	Selected
Cost of equity	11.00% - 12.70%	11.85%
Tax rate	6.80% - 7.40%	7.10%
Cost of debt	10.80% - 15.40%	13.10%
WACC	10.1% - 14.1%	12.1%

WACC

BRNL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.5	0.52

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.00%	12.70%

Tax rate	6.80%	7.40%
Debt/Equity ratio	7.45	7.45
Cost of debt	10.80%	15.40%

After-tax WACC	10.1%	14.1%


Selected WACC	12.1%

BRNL.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 BRNL.NS:

cost_of_equity (11.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.5) + 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.