KANSAINER.NS WACC - Weighted Average Cost of Capital

The WACC of Kansai Nerolac Paints Ltd (KANSAINER.NS) is 15.8%.

The Cost of Equity of Kansai Nerolac Paints Ltd (KANSAINER.NS) is 15.95%.

The Cost of Debt of Kansai Nerolac Paints Ltd (KANSAINER.NS) is 6.85%.

	Range	Selected
Cost of equity	14.60% - 17.30%	15.95%
Tax rate	25.60% - 26.20%	25.90%
Cost of debt	6.20% - 7.50%	6.85%
WACC	14.5% - 17.2%	15.8%

WACC

KANSAINER.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.93	1.02

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.60%	17.30%

Tax rate	25.60%	26.20%
Debt/Equity ratio	0.01	0.01
Cost of debt	6.20%	7.50%

After-tax WACC	14.5%	17.2%


Selected WACC	15.8%

KANSAINER.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 KANSAINER.NS:

cost_of_equity (15.95%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.93) + 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.