KNRCON.NS WACC - Weighted Average Cost of Capital

The WACC of KNR Constructions Ltd (KNRCON.NS) is 17.2%.

The Cost of Equity of KNR Constructions Ltd (KNRCON.NS) is 19.05%.

The Cost of Debt of KNR Constructions Ltd (KNRCON.NS) is 11.00%.

	Range	Selected
Cost of equity	16.60% - 21.50%	19.05%
Tax rate	24.60% - 29.80%	27.20%
Cost of debt	7.60% - 14.40%	11.00%
WACC	14.8% - 19.6%	17.2%

WACC

KNRCON.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.18	1.46

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.60%	21.50%

Tax rate	24.60%	29.80%
Debt/Equity ratio	0.2	0.2
Cost of debt	7.60%	14.40%

After-tax WACC	14.8%	19.6%


Selected WACC	17.2%

KNRCON.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 KNRCON.NS:

cost_of_equity (19.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.18) + 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.