IMFA.NS WACC - Weighted Average Cost of Capital

The WACC of Indian Metals and Ferro Alloys Ltd (IMFA.NS) is 17.3%.

The Cost of Equity of Indian Metals and Ferro Alloys Ltd (IMFA.NS) is 18.25%.

The Cost of Debt of Indian Metals and Ferro Alloys Ltd (IMFA.NS) is 9.70%.

	Range	Selected
Cost of equity	16.70% - 19.80%	18.25%
Tax rate	26.60% - 28.30%	27.45%
Cost of debt	7.50% - 11.90%	9.70%
WACC	15.7% - 18.8%	17.3%

WACC

IMFA.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.18	1.28

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.70%	19.80%

Tax rate	26.60%	28.30%
Debt/Equity ratio	0.1	0.1
Cost of debt	7.50%	11.90%

After-tax WACC	15.7%	18.8%


Selected WACC	17.3%

IMFA.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 IMFA.NS:

cost_of_equity (18.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.18) + 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.