CREATIVE.NS WACC - Weighted Average Cost of Capital

The WACC of Creative Peripherals and Distribution Ltd (CREATIVE.NS) is 11.3%.

The Cost of Equity of Creative Peripherals and Distribution Ltd (CREATIVE.NS) is 11.65%.

The Cost of Debt of Creative Peripherals and Distribution Ltd (CREATIVE.NS) is 8.95%.

	Range	Selected
Cost of equity	10.70% - 12.60%	11.65%
Tax rate	21.80% - 24.80%	23.30%
Cost of debt	7.60% - 10.30%	8.95%
WACC	10.3% - 12.3%	11.3%

WACC

CREATIVE.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.46	0.51

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.70%	12.60%

Tax rate	21.80%	24.80%
Debt/Equity ratio	0.07	0.07
Cost of debt	7.60%	10.30%

After-tax WACC	10.3%	12.3%


Selected WACC	11.3%

CREATIVE.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 CREATIVE.NS:

cost_of_equity (11.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.46) + 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.