KAVVERITEL.NS WACC - Weighted Average Cost of Capital

The WACC of Kavveri Telecom Products Ltd (KAVVERITEL.NS) is 12.4%.

The Cost of Equity of Kavveri Telecom Products Ltd (KAVVERITEL.NS) is 13.95%.

The Cost of Debt of Kavveri Telecom Products Ltd (KAVVERITEL.NS) is 4.25%.

	Range	Selected
Cost of equity	12.60% - 15.30%	13.95%
Tax rate	1.80% - 4.80%	3.30%
Cost of debt	4.00% - 4.50%	4.25%
WACC	11.2% - 13.6%	12.4%

WACC

KAVVERITEL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.68	0.8

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.60%	15.30%

Tax rate	1.80%	4.80%
Debt/Equity ratio	0.18	0.18
Cost of debt	4.00%	4.50%

After-tax WACC	11.2%	13.6%


Selected WACC	12.4%

KAVVERITEL.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 KAVVERITEL.NS:

cost_of_equity (13.95%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.68) + 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.