JETKNIT.NS WACC - Weighted Average Cost of Capital

The WACC of Jet Knitwears Ltd (JETKNIT.NS) is 12.1%.

The Cost of Equity of Jet Knitwears Ltd (JETKNIT.NS) is 13.30%.

The Cost of Debt of Jet Knitwears Ltd (JETKNIT.NS) is 10.30%.

	Range	Selected
Cost of equity	12.10% - 14.50%	13.30%
Tax rate	26.80% - 27.90%	27.35%
Cost of debt	10.10% - 10.50%	10.30%
WACC	11.1% - 13.0%	12.1%

WACC

JETKNIT.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.63	0.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.10%	14.50%

Tax rate	26.80%	27.90%
Debt/Equity ratio	0.27	0.27
Cost of debt	10.10%	10.50%

After-tax WACC	11.1%	13.0%


Selected WACC	12.1%

JETKNIT.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 JETKNIT.NS:

cost_of_equity (13.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.63) + 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.