INDI.L WACC - Weighted Average Cost of Capital

The WACC of Indus Gas Ltd (INDI.L) is 4.3%.

The Cost of Equity of Indus Gas Ltd (INDI.L) is 17.20%.

The Cost of Debt of Indus Gas Ltd (INDI.L) is 6.60%.

	Range	Selected
Cost of equity	13.50% - 20.90%	17.20%
Tax rate	38.00% - 40.80%	39.40%
Cost of debt	4.00% - 9.20%	6.60%
WACC	2.8% - 5.9%	4.3%

WACC

INDI.L WACC calculation

Category	Low	High

Long-term bond rate	4.0%	4.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.6	2.28

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.50%	20.90%

Tax rate	38.00%	40.80%
Debt/Equity ratio	34.74	34.74
Cost of debt	4.00%	9.20%

After-tax WACC	2.8%	5.9%


Selected WACC	4.3%

INDI.L'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 INDI.L:

cost_of_equity (17.20%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.6) + 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.