EKC.NS WACC - Weighted Average Cost of Capital

The WACC of Everest Kanto Cylinder Ltd (EKC.NS) is 16.2%.

The Cost of Equity of Everest Kanto Cylinder Ltd (EKC.NS) is 16.65%.

The Cost of Debt of Everest Kanto Cylinder Ltd (EKC.NS) is 7.50%.

	Range	Selected
Cost of equity	15.00% - 18.30%	16.65%
Tax rate	25.20% - 32.40%	28.80%
Cost of debt	7.50% - 7.50%	7.50%
WACC	14.6% - 17.8%	16.2%

WACC

EKC.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.98	1.12

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.00%	18.30%

Tax rate	25.20%	32.40%
Debt/Equity ratio	0.04	0.04
Cost of debt	7.50%	7.50%

After-tax WACC	14.6%	17.8%


Selected WACC	16.2%

EKC.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 EKC.NS:

cost_of_equity (16.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.98) + 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.