MAHEPC.NS WACC - Weighted Average Cost of Capital

The WACC of Mahindra EPC Irrigation Ltd (MAHEPC.NS) is 55.3%.

The Cost of Equity of Mahindra EPC Irrigation Ltd (MAHEPC.NS) is 15.85%.

The Cost of Debt of Mahindra EPC Irrigation Ltd (MAHEPC.NS) is 885.30%.

	Range	Selected
Cost of equity	13.70% - 18.00%	15.85%
Tax rate	24.60% - 27.40%	26.00%
Cost of debt	7.90% - 1,762.70%	885.30%
WACC	13.2% - 97.3%	55.3%

WACC

MAHEPC.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.82	1.09

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.70%	18.00%

Tax rate	24.60%	27.40%
Debt/Equity ratio	0.07	0.07
Cost of debt	7.90%	1,762.70%

After-tax WACC	13.2%	97.3%


Selected WACC	55.3%

MAHEPC.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 MAHEPC.NS:

cost_of_equity (15.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.82) + 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.