IFBIND.NS WACC - Weighted Average Cost of Capital

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

The Cost of Equity of IFB Industries Ltd (IFBIND.NS) is 14.85%.

The Cost of Debt of IFB Industries Ltd (IFBIND.NS) is 7.85%.

	Range	Selected
Cost of equity	13.50% - 16.20%	14.85%
Tax rate	33.20% - 34.80%	34.00%
Cost of debt	7.60% - 8.10%	7.85%
WACC	13.2% - 15.7%	14.5%

WACC

IFBIND.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.8	0.89

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.50%	16.20%

Tax rate	33.20%	34.80%
Debt/Equity ratio	0.04	0.04
Cost of debt	7.60%	8.10%

After-tax WACC	13.2%	15.7%


Selected WACC	14.5%

IFBIND.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 IFBIND.NS:

cost_of_equity (14.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.8) + 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.