GODFRYPHLP.NS WACC - Weighted Average Cost of Capital
The WACC of Godfrey Phillips India Ltd (GODFRYPHLP.NS) is 13.1%.
| Range | Selected | |
| Cost of equity | 12.0% - 14.3% | 13.15% |
| Tax rate | 22.0% - 22.8% | 22.4% |
| Cost of debt | 7.5% - 7.5% | 7.5% |
| WACC | 11.9% - 14.3% | 13.1% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.61 | 0.69 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 12.0% | 14.3% |
| Tax rate | 22.0% | 22.8% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 7.5% | 7.5% |
| After-tax WACC | 11.9% | 14.3% |
| Selected WACC | 13.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| GODFRYPHLP.NS | Godfrey Phillips India Ltd | 0.01 | 1.39 | 1.39 |
| 033780.KS | KT&G Corp | 0.1 | 0.16 | 0.15 |
| 2914.T | Japan Tobacco Inc | 0.19 | 0.56 | 0.49 |
| 526723.BO | NTC Industries Ltd | 0.16 | 1.26 | 1.12 |
| BAT.KL | British American Tobacco (Malaysia) Bhd | 0.36 | 0.68 | 0.53 |
| CLC.VN | Cat Loi JSC | 0.49 | 0.44 | 0.32 |
| GOLDENTOBC.NS | Golden Tobacco Ltd | 0.03 | 0.24 | 0.23 |
| ITC.NS | ITC Ltd | 0 | 0.56 | 0.56 |
| ITIC.JK | Indonesian Tobacco Tbk PT | 0.74 | 0.37 | 0.23 |
| WIIM.JK | Wismilak Inti Makmur Tbk PT | 0.24 | 1.27 | 1.07 |
| Low | High | |
| Unlevered beta | 0.42 | 0.54 |
| Relevered beta | 0.42 | 0.54 |
| Adjusted relevered beta | 0.61 | 0.69 |
GODFRYPHLP.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 GODFRYPHLP.NS:
cost_of_equity (13.15%) = 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.