GARFIBRES.NS WACC - Weighted Average Cost of Capital

The WACC of Garware Technical Fibres Ltd (GARFIBRES.NS) is 14.3%.

The Cost of Equity of Garware Technical Fibres Ltd (GARFIBRES.NS) is 14.40%.

The Cost of Debt of Garware Technical Fibres Ltd (GARFIBRES.NS) is 9.50%.

	Range	Selected
Cost of equity	12.10% - 16.70%	14.40%
Tax rate	23.20% - 23.60%	23.40%
Cost of debt	7.50% - 11.50%	9.50%
WACC	12.0% - 16.6%	14.3%

WACC

GARFIBRES.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.63	0.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.10%	16.70%

Tax rate	23.20%	23.60%
Debt/Equity ratio	0.01	0.01
Cost of debt	7.50%	11.50%

After-tax WACC	12.0%	16.6%


Selected WACC	14.3%

GARFIBRES.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 GARFIBRES.NS:

cost_of_equity (14.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.63) + 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.