LIBAS.NS WACC - Weighted Average Cost of Capital

The WACC of Libas Consumer Products Ltd (LIBAS.NS) is 15.7%.

The Cost of Equity of Libas Consumer Products Ltd (LIBAS.NS) is 17.40%.

The Cost of Debt of Libas Consumer Products Ltd (LIBAS.NS) is 11.50%.

	Range	Selected
Cost of equity	15.10% - 19.70%	17.40%
Tax rate	2.00% - 5.50%	3.75%
Cost of debt	10.50% - 12.50%	11.50%
WACC	13.8% - 17.6%	15.7%

WACC

LIBAS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.99	1.27

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.10%	19.70%

Tax rate	2.00%	5.50%
Debt/Equity ratio	0.35	0.35
Cost of debt	10.50%	12.50%

After-tax WACC	13.8%	17.6%


Selected WACC	15.7%

LIBAS.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 LIBAS.NS:

cost_of_equity (17.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.99) + 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.