HECPROJECT.NS WACC - Weighted Average Cost of Capital

The WACC of HEC Infra Projects Ltd (HECPROJECT.NS) is 10.3%.

The Cost of Equity of HEC Infra Projects Ltd (HECPROJECT.NS) is 11.65%.

The Cost of Debt of HEC Infra Projects Ltd (HECPROJECT.NS) is 7.55%.

	Range	Selected
Cost of equity	10.40% - 12.90%	11.65%
Tax rate	28.40% - 31.00%	29.70%
Cost of debt	7.30% - 7.80%	7.55%
WACC	9.3% - 11.3%	10.3%

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	0.42	0.54

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.40%	12.90%

Tax rate	28.40%	31.00%
Debt/Equity ratio	0.27	0.27
Cost of debt	7.30%	7.80%

After-tax WACC	9.3%	11.3%


Selected WACC	10.3%

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 (11.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.42) + 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.