INDTERRAIN.NS WACC - Weighted Average Cost of Capital

The WACC of Indian Terrain Fashions Ltd (INDTERRAIN.NS) is 10.1%.

The Cost of Equity of Indian Terrain Fashions Ltd (INDTERRAIN.NS) is 12.30%.

The Cost of Debt of Indian Terrain Fashions Ltd (INDTERRAIN.NS) is 13.35%.

	Range	Selected
Cost of equity	10.20% - 14.40%	12.30%
Tax rate	39.00% - 44.80%	41.90%
Cost of debt	7.00% - 19.70%	13.35%
WACC	7.5% - 12.8%	10.1%

WACC

INDTERRAIN.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.4	0.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.20%	14.40%

Tax rate	39.00%	44.80%
Debt/Equity ratio	0.84	0.84
Cost of debt	7.00%	19.70%

After-tax WACC	7.5%	12.8%


Selected WACC	10.1%

INDTERRAIN.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 INDTERRAIN.NS:

cost_of_equity (12.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.4) + 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.