GVKPIL.NS WACC - Weighted Average Cost of Capital
The WACC of GVK Power & Infrastructure Ltd (GVKPIL.NS) is 15.6%.
| Range | Selected | |
| Cost of equity | 46.7% - 66.3% | 56.5% |
| Tax rate | 10.6% - 13.4% | 12% |
| Cost of debt | 7.1% - 15.4% | 11.25% |
| WACC | 11.3% - 19.8% | 15.6% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 4.8 | 6.28 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 46.7% | 66.3% |
| Tax rate | 10.6% | 13.4% |
| Debt/Equity ratio | 7.14 | 7.14 |
| Cost of debt | 7.1% | 15.4% |
| After-tax WACC | 11.3% | 19.8% |
| Selected WACC | 15.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| GVKPIL.NS | GVK Power & Infrastructure Ltd | 7.14 | 0.54 | 0.07 |
| 002023.SZ | Sichuan Haite High-tech Co Ltd | 0.26 | 1.21 | 0.99 |
| 005430.KS | Korea Airport Service Co Ltd | 0.12 | 0.9 | 0.81 |
| 300424.SZ | Guangzhou Hangxin Aviation Technology Co Ltd | 0.24 | 1.88 | 1.55 |
| 4031.SR | Saudi Ground Services Co | 0.02 | 1.54 | 1.51 |
| GMRINFRA.NS | GMR Infrastructure Ltd | 0.46 | 1.83 | 1.3 |
| GPPL.NS | Gujarat Pipavav Port Ltd | 0.01 | 1.17 | 1.16 |
| MEP.NS | MEP Infrastructure Developers Ltd | 13.21 | 0.58 | 0.05 |
| MMAN.TA | Maman Cargo Terminals & Handling Ltd | 2.25 | 0.41 | 0.14 |
| NAVKARCORP.NS | Navkar Corporation Ltd | 0.09 | 1.86 | 1.73 |
| Low | High | |
| Unlevered beta | 0.92 | 1.22 |
| Relevered beta | 6.67 | 8.88 |
| Adjusted relevered beta | 4.8 | 6.28 |
GVKPIL.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 GVKPIL.NS:
cost_of_equity (56.50%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (4.8) + 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.