IFBAGRO.NS WACC - Weighted Average Cost of Capital

The WACC of IFB Agro Industries Ltd (IFBAGRO.NS) is 14.5%.

The Cost of Equity of IFB Agro Industries Ltd (IFBAGRO.NS) is 14.50%.

The Cost of Debt of IFB Agro Industries Ltd (IFBAGRO.NS) is 20.20%.

	Range	Selected
Cost of equity	13.00% - 16.00%	14.50%
Tax rate	24.60% - 30.90%	27.75%
Cost of debt	7.50% - 32.90%	20.20%
WACC	12.9% - 16.1%	14.5%

WACC

IFBAGRO.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.74	0.87

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.00%	16.00%

Tax rate	24.60%	30.90%
Debt/Equity ratio	0.02	0.02
Cost of debt	7.50%	32.90%

After-tax WACC	12.9%	16.1%


Selected WACC	14.5%

IFBAGRO.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 IFBAGRO.NS:

cost_of_equity (14.50%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.74) + 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.