INDOTECH.NS WACC - Weighted Average Cost of Capital
The WACC of Indo Tech Transformers Ltd (INDOTECH.NS) is 16.1%.
| Range | Selected | |
| Cost of equity | 14.7% - 17.6% | 16.15% |
| Tax rate | 1.8% - 8.7% | 5.25% |
| Cost of debt | 7.5% - 7.5% | 7.5% |
| WACC | 14.7% - 17.5% | 16.1% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.95 | 1.04 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 14.7% | 17.6% |
| Tax rate | 1.8% | 8.7% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 7.5% | 7.5% |
| After-tax WACC | 14.7% | 17.5% |
| Selected WACC | 16.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| INDOTECH.NS | Indo Tech Transformers Ltd | 0 | 1.7 | 1.7 |
| 504076.BO | Jyoti Ltd | 0.89 | 1.04 | 0.56 |
| 504093.BO | Panasonic Energy India Co Ltd | 0 | 1.09 | 1.09 |
| 504240.BO | Delton Cables Ltd | 0.1 | 1.62 | 1.47 |
| 532455.BO | Shalimar Wires Industries Ltd | 0.94 | 1.81 | 0.95 |
| 542670.BO | Artemis Electricals Ltd | 0.02 | -0.47 | -0.46 |
| DELTAMAGNT.NS | Delta Manufacturing Ltd | 0.56 | 1.35 | 0.87 |
| HIRECT.NS | Hind Rectifiers Ltd | 0.07 | 1.65 | 1.54 |
| SWELECTES.NS | Swelect Energy Systems Ltd | 0.67 | 1.31 | 0.79 |
| VETO.NS | VETO Switch Gears And Cables Ltd | 0.09 | 1.13 | 1.04 |
| Low | High | |
| Unlevered beta | 0.92 | 1.06 |
| Relevered beta | 0.93 | 1.06 |
| Adjusted relevered beta | 0.95 | 1.04 |
INDOTECH.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 INDOTECH.NS:
cost_of_equity (16.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.95) + 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.