MARKSANS.NS WACC - Weighted Average Cost of Capital

The WACC of Marksans Pharma Ltd (MARKSANS.NS) is 15.8%.

The Cost of Equity of Marksans Pharma Ltd (MARKSANS.NS) is 16.05%.

The Cost of Debt of Marksans Pharma Ltd (MARKSANS.NS) is 8.15%.

	Range	Selected
Cost of equity	14.60% - 17.50%	16.05%
Tax rate	24.30% - 24.70%	24.50%
Cost of debt	7.50% - 8.80%	8.15%
WACC	14.3% - 17.2%	15.8%

WACC

MARKSANS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.93	1.04

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.60%	17.50%

Tax rate	24.30%	24.70%
Debt/Equity ratio	0.03	0.03
Cost of debt	7.50%	8.80%

After-tax WACC	14.3%	17.2%


Selected WACC	15.8%

MARKSANS.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 MARKSANS.NS:

cost_of_equity (16.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.93) + 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.