JMTAUTOLTD.NS WACC - Weighted Average Cost of Capital

The WACC of JMT Auto Ltd (JMTAUTOLTD.NS) is 11.1%.

The Cost of Equity of JMT Auto Ltd (JMTAUTOLTD.NS) is 24.80%.

The Cost of Debt of JMT Auto Ltd (JMTAUTOLTD.NS) is 7.55%.

	Range	Selected
Cost of equity	20.90% - 28.70%	24.80%
Tax rate	19.60% - 26.30%	22.95%
Cost of debt	7.00% - 8.10%	7.55%
WACC	9.8% - 12.3%	11.1%

WACC

JMTAUTOLTD.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.69	2.24

Additional risk adjustments	0.0%	0.5%
Cost of equity	20.90%	28.70%

Tax rate	19.60%	26.30%
Debt/Equity ratio	2.63	2.63
Cost of debt	7.00%	8.10%

After-tax WACC	9.8%	12.3%


Selected WACC	11.1%

JMTAUTOLTD.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 JMTAUTOLTD.NS:

cost_of_equity (24.80%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.69) + 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.