MARICO.NS WACC - Weighted Average Cost of Capital

The WACC of Marico Ltd (MARICO.NS) is 12.8%.

The Cost of Equity of Marico Ltd (MARICO.NS) is 12.85%.

The Cost of Debt of Marico Ltd (MARICO.NS) is 8.95%.

	Range	Selected
Cost of equity	11.40% - 14.30%	12.85%
Tax rate	21.60% - 22.00%	21.80%
Cost of debt	7.50% - 10.40%	8.95%
WACC	11.4% - 14.3%	12.8%

WACC

MARICO.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.55	0.7

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.40%	14.30%

Tax rate	21.60%	22.00%
Debt/Equity ratio	0.01	0.01
Cost of debt	7.50%	10.40%

After-tax WACC	11.4%	14.3%


Selected WACC	12.8%

MARICO.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 MARICO.NS:

cost_of_equity (12.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.55) + 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.