EUROCERA.NS WACC - Weighted Average Cost of Capital

The WACC of Euro Ceramics Ltd (EUROCERA.NS) is 6.4%.

The Cost of Equity of Euro Ceramics Ltd (EUROCERA.NS) is 59.40%.

The Cost of Debt of Euro Ceramics Ltd (EUROCERA.NS) is 5.80%.

	Range	Selected
Cost of equity	35.50% - 83.30%	59.40%
Tax rate	-% - 9.00%	4.50%
Cost of debt	4.00% - 7.60%	5.80%
WACC	4.5% - 8.2%	6.4%

WACC

EUROCERA.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	6.9%	7.9%
Adjusted beta	4.14	9.52

Additional risk adjustments	0.0%	0.5%
Cost of equity	35.50%	83.30%

Tax rate	-%	9.00%
Debt/Equity ratio	58.81	58.81
Cost of debt	4.00%	7.60%

After-tax WACC	4.5%	8.2%


Selected WACC	6.4%

EUROCERA.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 EUROCERA.NS:

cost_of_equity (59.40%) = risk_free_rate (7.15%) + equity_risk_premium (7.40%) * adjusted_beta (4.14) + 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.