HESTERBIO.NS WACC - Weighted Average Cost of Capital

The WACC of Hester Biosciences Ltd (HESTERBIO.NS) is 11.3%.

The Cost of Equity of Hester Biosciences Ltd (HESTERBIO.NS) is 12.25%.

The Cost of Debt of Hester Biosciences Ltd (HESTERBIO.NS) is 7.45%.

	Range	Selected
Cost of equity	10.80% - 13.70%	12.25%
Tax rate	29.00% - 30.40%	29.70%
Cost of debt	6.30% - 8.60%	7.45%
WACC	9.9% - 12.7%	11.3%

WACC

HESTERBIO.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.47	0.63

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.80%	13.70%

Tax rate	29.00%	30.40%
Debt/Equity ratio	0.16	0.16
Cost of debt	6.30%	8.60%

After-tax WACC	9.9%	12.7%


Selected WACC	11.3%

HESTERBIO.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 HESTERBIO.NS:

cost_of_equity (12.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.47) + 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.