HAPPSTMNDS.NS WACC - Weighted Average Cost of Capital

The WACC of Happiest Minds Technologies Ltd (HAPPSTMNDS.NS) is 13.7%.

The Cost of Equity of Happiest Minds Technologies Ltd (HAPPSTMNDS.NS) is 14.10%.

The Cost of Debt of Happiest Minds Technologies Ltd (HAPPSTMNDS.NS) is 7.20%.

	Range	Selected
Cost of equity	11.30% - 16.90%	14.10%
Tax rate	20.30% - 25.60%	22.95%
Cost of debt	6.30% - 8.10%	7.20%
WACC	11.0% - 16.3%	13.7%

WACC

HAPPSTMNDS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.54	0.97

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.30%	16.90%

Tax rate	20.30%	25.60%
Debt/Equity ratio	0.06	0.06
Cost of debt	6.30%	8.10%

After-tax WACC	11.0%	16.3%


Selected WACC	13.7%

HAPPSTMNDS.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 HAPPSTMNDS.NS:

cost_of_equity (14.10%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.54) + 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.