ELECTCAST.NS
Electrosteel Castings Ltd
Price:  
120.4 
INR
Volume:  
1,585,922
India | Building Products

ELECTCAST.NS WACC - Weighted Average Cost of Capital

The WACC of Electrosteel Castings Ltd (ELECTCAST.NS) is 15.0%.

The Cost of Equity of Electrosteel Castings Ltd (ELECTCAST.NS) is 17.55%.
The Cost of Debt of Electrosteel Castings Ltd (ELECTCAST.NS) is 8.65%.

RangeSelected
Cost of equity15.7% - 19.4%17.55%
Tax rate21.5% - 22.6%22.05%
Cost of debt8.1% - 9.2%8.65%
WACC13.5% - 16.5%15.0%
WACC

ELECTCAST.NS WACC calculation

CategoryLowHigh
Long-term bond rate6.9%7.4%
Equity market risk premium8.3%9.3%
Adjusted beta1.071.24
Additional risk adjustments0.0%0.5%
Cost of equity15.7%19.4%
Tax rate21.5%22.6%
Debt/Equity ratio
0.310.31
Cost of debt8.1%9.2%
After-tax WACC13.5%16.5%
Selected WACC15.0%

ELECTCAST.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 ELECTCAST.NS:

cost_of_equity (17.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.07) + 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.