GICHSGFIN.NS WACC - Weighted Average Cost of Capital

The WACC of GIC Housing Finance Ltd (GICHSGFIN.NS) is 13.0%.

The Cost of Equity of GIC Housing Finance Ltd (GICHSGFIN.NS) is 14.35%.

The Cost of Debt of GIC Housing Finance Ltd (GICHSGFIN.NS) is 17.20%.

	Range	Selected
Cost of equity	11.90% - 16.80%	14.35%
Tax rate	23.80% - 25.10%	24.45%
Cost of debt	7.50% - 26.90%	17.20%
WACC	6.2% - 19.9%	13.0%

WACC

GICHSGFIN.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.61	0.96

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.90%	16.80%

Tax rate	23.80%	25.10%
Debt/Equity ratio	12.3	12.3
Cost of debt	7.50%	26.90%

After-tax WACC	6.2%	19.9%


Selected WACC	13.0%

GICHSGFIN.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 GICHSGFIN.NS:

cost_of_equity (14.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.61) + 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.