CIGNITITEC.NS WACC - Weighted Average Cost of Capital

The WACC of Cigniti Technologies Ltd (CIGNITITEC.NS) is 13.9%.

The Cost of Equity of Cigniti Technologies Ltd (CIGNITITEC.NS) is 14.00%.

The Cost of Debt of Cigniti Technologies Ltd (CIGNITITEC.NS) is 5.95%.

	Range	Selected
Cost of equity	11.40% - 16.60%	14.00%
Tax rate	24.30% - 24.60%	24.45%
Cost of debt	4.40% - 7.50%	5.95%
WACC	11.3% - 16.4%	13.9%

WACC

CIGNITITEC.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.55	0.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.40%	16.60%

Tax rate	24.30%	24.60%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.40%	7.50%

After-tax WACC	11.3%	16.4%


Selected WACC	13.9%

CIGNITITEC.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 CIGNITITEC.NS:

cost_of_equity (14.00%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.55) + 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.