MADHAV.NS WACC - Weighted Average Cost of Capital

The WACC of Madhav Marbles and Granites Ltd (MADHAV.NS) is 12.4%.

The Cost of Equity of Madhav Marbles and Granites Ltd (MADHAV.NS) is 11.75%.

The Cost of Debt of Madhav Marbles and Granites Ltd (MADHAV.NS) is 19.90%.

	Range	Selected
Cost of equity	10.40% - 13.10%	11.75%
Tax rate	23.10% - 28.80%	25.95%
Cost of debt	15.90% - 23.90%	19.90%
WACC	10.8% - 14.0%	12.4%

WACC

MADHAV.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.42	0.57

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.40%	13.10%

Tax rate	23.10%	28.80%
Debt/Equity ratio	0.28	0.28
Cost of debt	15.90%	23.90%

After-tax WACC	10.8%	14.0%


Selected WACC	12.4%

MADHAV.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 MADHAV.NS:

cost_of_equity (11.75%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.42) + 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.