GILLANDERS.NS WACC - Weighted Average Cost of Capital

The WACC of Gillanders Arbuthnot & Co Ltd (GILLANDERS.NS) is 13.7%.

The Cost of Equity of Gillanders Arbuthnot & Co Ltd (GILLANDERS.NS) is 16.65%.

The Cost of Debt of Gillanders Arbuthnot & Co Ltd (GILLANDERS.NS) is 11.15%.

	Range	Selected
Cost of equity	14.60% - 18.70%	16.65%
Tax rate	6.40% - 12.80%	9.60%
Cost of debt	10.20% - 12.10%	11.15%
WACC	12.3% - 15.1%	13.7%

WACC

GILLANDERS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.93	1.17

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.60%	18.70%

Tax rate	6.40%	12.80%
Debt/Equity ratio	0.81	0.81
Cost of debt	10.20%	12.10%

After-tax WACC	12.3%	15.1%


Selected WACC	13.7%

GILLANDERS.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 GILLANDERS.NS:

cost_of_equity (16.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.93) + 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.