IGARASHI.NS WACC - Weighted Average Cost of Capital

The WACC of Igarashi Motors India Ltd (IGARASHI.NS) is 14.9%.

The Cost of Equity of Igarashi Motors India Ltd (IGARASHI.NS) is 15.80%.

The Cost of Debt of Igarashi Motors India Ltd (IGARASHI.NS) is 7.10%.

	Range	Selected
Cost of equity	13.50% - 18.10%	15.80%
Tax rate	27.00% - 35.60%	31.30%
Cost of debt	5.90% - 8.30%	7.10%
WACC	12.7% - 17.0%	14.9%

WACC

IGARASHI.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.79	1.1

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.50%	18.10%

Tax rate	27.00%	35.60%
Debt/Equity ratio	0.09	0.09
Cost of debt	5.90%	8.30%

After-tax WACC	12.7%	17.0%


Selected WACC	14.9%

IGARASHI.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 IGARASHI.NS:

cost_of_equity (15.80%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.79) + 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.