HBLPOWER.NS WACC - Weighted Average Cost of Capital

The WACC of HBL Power Systems Ltd (HBLPOWER.NS) is 15.1%.

The Cost of Equity of HBL Power Systems Ltd (HBLPOWER.NS) is 15.15%.

The Cost of Debt of HBL Power Systems Ltd (HBLPOWER.NS) is 6.55%.

	Range	Selected
Cost of equity	14.10% - 16.20%	15.15%
Tax rate	25.90% - 27.90%	26.90%
Cost of debt	5.60% - 7.50%	6.55%
WACC	14.0% - 16.1%	15.1%

WACC

HBLPOWER.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.87	0.89

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.10%	16.20%

Tax rate	25.90%	27.90%
Debt/Equity ratio	0.01	0.01
Cost of debt	5.60%	7.50%

After-tax WACC	14.0%	16.1%


Selected WACC	15.1%

HBLPOWER.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 HBLPOWER.NS:

cost_of_equity (15.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.87) + 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.