FLFL.NS WACC - Weighted Average Cost of Capital

The WACC of Future Lifestyle Fashions Ltd (FLFL.NS) is 7.9%.

The Cost of Equity of Future Lifestyle Fashions Ltd (FLFL.NS) is 46.90%.

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

	Range	Selected
Cost of equity	24.00% - 69.80%	46.90%
Tax rate	12.80% - 24.20%	18.50%
Cost of debt	7.00% - 11.80%	9.40%
WACC	6.3% - 9.6%	7.9%

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	2.07	6.65

Additional risk adjustments	0.0%	0.5%
Cost of equity	24.00%	69.80%

Tax rate	12.80%	24.20%
Debt/Equity ratio	87.56	87.56
Cost of debt	7.00%	11.80%

After-tax WACC	6.3%	9.6%


Selected WACC	7.9%

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 (46.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (2.07) + 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.