The WACC of Dilip Buildcon Ltd (DBL.NS) is 13.3%.
Range | Selected | |
Cost of equity | 15.9% - 20.8% | 18.35% |
Tax rate | 25.9% - 40.8% | 33.35% |
Cost of debt | 12.1% - 12.6% | 12.35% |
WACC | 12.4% - 14.1% | 13.3% |
Category | Low | High |
Long-term bond rate | 6.9% | 7.4% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 1.09 | 1.39 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 15.9% | 20.8% |
Tax rate | 25.9% | 40.8% |
Debt/Equity ratio | 1.01 | 1.01 |
Cost of debt | 12.1% | 12.6% |
After-tax WACC | 12.4% | 14.1% |
Selected WACC | 13.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
DBL.NS | Dilip Buildcon Ltd | 1.01 | 1.45 | 0.85 |
IRCON.NS | Ircon International Ltd | 0.14 | 2.01 | 1.83 |
JMCPROJECT.NS | JMC Projects (India) Ltd | 0.9 | 1.63 | 0.99 |
KALPATPOWR.NS | Kalpataru Power Transmission Ltd | 0.37 | 0.49 | 0.39 |
NBCC.NS | NBCC (India) Ltd | 0 | 1.94 | 1.94 |
NCC.NS | NCC Ltd | 0.07 | 1.63 | 1.55 |
PNCINFRA.NS | PNC Infratech Ltd | 1.07 | 1.54 | 0.87 |
PUNJLLOYD.NS | Punj Lloyd Ltd | 114.62 | 1.4 | 0.02 |
SADBHAV.NS | Sadbhav Engineering Ltd | 15.1 | 0.85 | 0.07 |
SIMPLEXINF.NS | Simplex Infrastructures Ltd | 3.68 | 1.37 | 0.38 |
Low | High | |
Unlevered beta | 0.66 | 0.92 |
Relevered beta | 1.13 | 1.58 |
Adjusted relevered beta | 1.09 | 1.39 |
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 DBL.NS:
cost_of_equity (18.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.09) + 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.