FLFL.NS WACC - Weighted Average Cost of Capital

The WACC of Future Lifestyle Fashions Ltd (FLFL.NS) is 8.4%.

The Cost of Equity of Future Lifestyle Fashions Ltd (FLFL.NS) is 70.30%.

The Cost of Debt of Future Lifestyle Fashions Ltd (FLFL.NS) is 9.40%.

	Range	Selected
Cost of equity	29.00% - 111.60%	70.30%
Tax rate	12.80% - 24.20%	18.50%
Cost of debt	7.00% - 11.80%	9.40%
WACC	6.4% - 10.4%	8.4%

WACC

FLFL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	2.66	11.15

Additional risk adjustments	0.0%	0.5%
Cost of equity	29.00%	111.60%

Tax rate	12.80%	24.20%
Debt/Equity ratio	66.48	66.48
Cost of debt	7.00%	11.80%

After-tax WACC	6.4%	10.4%


Selected WACC	8.4%

FLFL.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 FLFL.NS:

cost_of_equity (70.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (2.66) + 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.