HECPROJECT.NS WACC - Weighted Average Cost of Capital

The WACC of HEC Infra Projects Ltd (HECPROJECT.NS) is 12.2%.

The Cost of Equity of HEC Infra Projects Ltd (HECPROJECT.NS) is 13.80%.

The Cost of Debt of HEC Infra Projects Ltd (HECPROJECT.NS) is 6.90%.

	Range	Selected
Cost of equity	11.70% - 15.90%	13.80%
Tax rate	25.60% - 31.00%	28.30%
Cost of debt	6.20% - 7.60%	6.90%
WACC	10.4% - 14.0%	12.2%

WACC

HECPROJECT.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.58	0.86

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.70%	15.90%

Tax rate	25.60%	31.00%
Debt/Equity ratio	0.22	0.22
Cost of debt	6.20%	7.60%

After-tax WACC	10.4%	14.0%


Selected WACC	12.2%

HECPROJECT.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 HECPROJECT.NS:

cost_of_equity (13.80%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.58) + 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.