KNRCON.NS WACC - Weighted Average Cost of Capital

The WACC of KNR Constructions Ltd (KNRCON.NS) is 15.5%.

The Cost of Equity of KNR Constructions Ltd (KNRCON.NS) is 19.00%.

The Cost of Debt of KNR Constructions Ltd (KNRCON.NS) is 11.70%.

	Range	Selected
Cost of equity	17.10% - 20.90%	19.00%
Tax rate	24.10% - 29.80%	26.95%
Cost of debt	8.30% - 15.10%	11.70%
WACC	13.5% - 17.5%	15.5%

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	1.23	1.4

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.10%	20.90%

Tax rate	24.10%	29.80%
Debt/Equity ratio	0.5	0.5
Cost of debt	8.30%	15.10%

After-tax WACC	13.5%	17.5%


Selected WACC	15.5%

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 (19.00%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.23) + 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.