IVC.NS WACC - Weighted Average Cost of Capital
The WACC of IL & FS Investment Managers Ltd (IVC.NS) is 11.8%.
| Range | Selected | |
| Cost of equity | 17.0% - 21.5% | 19.25% |
| Tax rate | 9.6% - 17.6% | 13.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 10.7% - 12.8% | 11.8% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 1.22 | 1.47 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 17.0% | 21.5% |
| Tax rate | 9.6% | 17.6% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 10.7% | 12.8% |
| Selected WACC | 11.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| IVC.NS | IL & FS Investment Managers Ltd | 1.13 | 1.24 | 0.63 |
| 530577.BO | Ladderup Finance Ltd | 0.22 | 0.3 | 0.25 |
| 531359.BO | Shriram Asset Management Co Ltd | 0 | 0.54 | 0.54 |
| 531502.BO | Esaar (India) Ltd | 1.97 | -0.41 | -0.15 |
| 532333.BO | HB Portfolio Ltd | 0.01 | 0.83 | 0.83 |
| 538180.BO | Gold Line International Finvest Ltd | 0.01 | 0.92 | 0.92 |
| 539875.BO | RSD Finance Ltd | 0.19 | 0.15 | 0.13 |
| DHUNINV.NS | Dhunseri Investments Ltd | 0.43 | 1.46 | 1.07 |
| JPOLYINVST.NS | Jindal Poly Investment and Finance Company Ltd | 0.03 | 1.59 | 1.55 |
| MCDHOLDING.NS | McDowell Holdings Ltd | 0.22 | 1.08 | 0.91 |
| NAHARCAP.NS | Nahar Capital and Financial Services Ltd | 0.01 | 1.4 | 1.39 |
| Low | High | |
| Unlevered beta | 0.63 | 0.91 |
| Relevered beta | 1.33 | 1.7 |
| Adjusted relevered beta | 1.22 | 1.47 |
IVC.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 IVC.NS:
cost_of_equity (19.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.22) + 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.