ESTER.NS WACC - Weighted Average Cost of Capital

The WACC of Ester Industries Ltd (ESTER.NS) is 13.9%.

The Cost of Equity of Ester Industries Ltd (ESTER.NS) is 17.65%.

The Cost of Debt of Ester Industries Ltd (ESTER.NS) is 11.20%.

	Range	Selected
Cost of equity	15.60% - 19.70%	17.65%
Tax rate	26.50% - 36.70%	31.60%
Cost of debt	10.30% - 12.10%	11.20%
WACC	12.6% - 15.1%	13.9%

WACC

ESTER.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.06	1.27

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.60%	19.70%

Tax rate	26.50%	36.70%
Debt/Equity ratio	0.61	0.61
Cost of debt	10.30%	12.10%

After-tax WACC	12.6%	15.1%


Selected WACC	13.9%

ESTER.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 ESTER.NS:

cost_of_equity (17.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.06) + 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.