CENTURYPLY.NS WACC - Weighted Average Cost of Capital

The WACC of Century Plyboards (India) Ltd (CENTURYPLY.NS) is 13.7%.

The Cost of Equity of Century Plyboards (India) Ltd (CENTURYPLY.NS) is 14.05%.

The Cost of Debt of Century Plyboards (India) Ltd (CENTURYPLY.NS) is 6.85%.

	Range	Selected
Cost of equity	12.30% - 15.80%	14.05%
Tax rate	26.40% - 27.50%	26.95%
Cost of debt	5.90% - 7.80%	6.85%
WACC	12.0% - 15.4%	13.7%

WACC

CENTURYPLY.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.66	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.30%	15.80%

Tax rate	26.40%	27.50%
Debt/Equity ratio	0.05	0.05
Cost of debt	5.90%	7.80%

After-tax WACC	12.0%	15.4%


Selected WACC	13.7%

CENTURYPLY.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 CENTURYPLY.NS:

cost_of_equity (14.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.66) + 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.