GEOJITFSL.NS WACC - Weighted Average Cost of Capital

The WACC of Geojit Financial Services Ltd (GEOJITFSL.NS) is 14.7%.

The Cost of Equity of Geojit Financial Services Ltd (GEOJITFSL.NS) is 16.05%.

The Cost of Debt of Geojit Financial Services Ltd (GEOJITFSL.NS) is 10.30%.

	Range	Selected
Cost of equity	14.80% - 17.30%	16.05%
Tax rate	25.40% - 25.50%	25.45%
Cost of debt	7.80% - 12.80%	10.30%
WACC	13.4% - 16.1%	14.7%

WACC

GEOJITFSL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.96	1.02

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.80%	17.30%

Tax rate	25.40%	25.50%
Debt/Equity ratio	0.19	0.19
Cost of debt	7.80%	12.80%

After-tax WACC	13.4%	16.1%


Selected WACC	14.7%

GEOJITFSL.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 GEOJITFSL.NS:

cost_of_equity (16.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.96) + 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.