DOLAT.NS WACC - Weighted Average Cost of Capital

The WACC of Dolat Investments Ltd (DOLAT.NS) is 13.7%.

The Cost of Equity of Dolat Investments Ltd (DOLAT.NS) is 14.55%.

The Cost of Debt of Dolat Investments Ltd (DOLAT.NS) is 5.00%.

	Range	Selected
Cost of equity	13.20% - 15.90%	14.55%
Tax rate	28.60% - 31.30%	29.95%
Cost of debt	5.00% - 5.00%	5.00%
WACC	12.5% - 15.0%	13.7%

WACC

DOLAT.NS WACC calculation

Category	Low	High

Long-term bond rate	7.5%	8.0%
Equity market risk premium	6.9%	7.9%
Adjusted beta	0.82	0.93

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.20%	15.90%

Tax rate	28.60%	31.30%
Debt/Equity ratio	0.08	0.08
Cost of debt	5.00%	5.00%

After-tax WACC	12.5%	15.0%


Selected WACC	13.7%

DOLAT.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 DOLAT.NS:

cost_of_equity (14.55%) = risk_free_rate (7.75%) + equity_risk_premium (7.40%) * adjusted_beta (0.82) + 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.