HAPPSTMNDS.NS WACC - Weighted Average Cost of Capital

The WACC of Happiest Minds Technologies Ltd (HAPPSTMNDS.NS) is 12.1%.

The Cost of Equity of Happiest Minds Technologies Ltd (HAPPSTMNDS.NS) is 13.25%.

The Cost of Debt of Happiest Minds Technologies Ltd (HAPPSTMNDS.NS) is 8.85%.

	Range	Selected
Cost of equity	10.90% - 15.60%	13.25%
Tax rate	25.70% - 26.00%	25.85%
Cost of debt	8.30% - 9.40%	8.85%
WACC	10.1% - 14.1%	12.1%

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	0.48	0.83

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.90%	15.60%

Tax rate	25.70%	26.00%
Debt/Equity ratio	0.21	0.21
Cost of debt	8.30%	9.40%

After-tax WACC	10.1%	14.1%


Selected WACC	12.1%

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 (13.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.48) + 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.