EDUCOMP.NS WACC - Weighted Average Cost of Capital
The WACC of Educomp Solutions Ltd (EDUCOMP.NS) is 4.8%.
| Range | Selected | |
| Cost of equity | 63.3% - 241.6% | 152.45% |
| Tax rate | 30.0% - 30.0% | 30% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.0% - 5.6% | 4.8% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 6.79 | 25.11 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 63.3% | 241.6% |
| Tax rate | 30.0% | 30.0% |
| Debt/Equity ratio | 112.98 | 112.98 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.0% | 5.6% |
| Selected WACC | 4.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| EDUCOMP.NS | Educomp Solutions Ltd | 112.98 | 2.49 | 0.03 |
| 1775.HK | Bexcellent Group Holdings Ltd | 1.08 | -0.13 | -0.07 |
| 2464.T | Business Breakthrough Inc | 0.03 | 0.14 | 0.14 |
| 517063.BO | Jetking Infotrain Ltd | 0.02 | 0.62 | 0.62 |
| AKG.AX | Academies Australasia Group Ltd | 2.79 | 0.23 | 0.08 |
| CAREERP.NS | Career Point Ltd | 0.05 | 1.28 | 1.24 |
| CLEDUCATE.NS | CL Educate Ltd | 0.07 | 1.7 | 1.62 |
| COMPUSOFT.NS | Compucom Software Ltd | 0.24 | 1.67 | 1.43 |
| MINDA.KL | Minda Global Bhd | 0.85 | -0.25 | -0.16 |
| MTEDUCARE.NS | MT Educare Ltd | 8.46 | 0.67 | 0.1 |
| ZEELEARN.NS | Zee Learn Ltd | 1.86 | 0.83 | 0.36 |
| Low | High | |
| Unlevered beta | 0.1 | 0.36 |
| Relevered beta | 9.64 | 36.99 |
| Adjusted relevered beta | 6.79 | 25.11 |
EDUCOMP.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 EDUCOMP.NS:
cost_of_equity (152.45%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (6.79) + 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.