COROMANDEL.NS WACC - Weighted Average Cost of Capital

The WACC of Coromandel International Ltd (COROMANDEL.NS) is 16.4%.

The Cost of Equity of Coromandel International Ltd (COROMANDEL.NS) is 16.45%.

The Cost of Debt of Coromandel International Ltd (COROMANDEL.NS) is 19.85%.

	Range	Selected
Cost of equity	14.70% - 18.20%	16.45%
Tax rate	25.30% - 25.40%	25.35%
Cost of debt	7.50% - 32.20%	19.85%
WACC	14.6% - 18.2%	16.4%

WACC

COROMANDEL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.94	1.11

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.70%	18.20%

Tax rate	25.30%	25.40%
Debt/Equity ratio	0.01	0.01
Cost of debt	7.50%	32.20%

After-tax WACC	14.6%	18.2%


Selected WACC	16.4%

COROMANDEL.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 COROMANDEL.NS:

cost_of_equity (16.45%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.94) + 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.