MASTEK.NS WACC - Weighted Average Cost of Capital

The WACC of Mastek Ltd (MASTEK.NS) is 13.4%.

The Cost of Equity of Mastek Ltd (MASTEK.NS) is 13.95%.

The Cost of Debt of Mastek Ltd (MASTEK.NS) is 7.95%.

	Range	Selected
Cost of equity	10.50% - 17.40%	13.95%
Tax rate	23.10% - 25.70%	24.40%
Cost of debt	7.60% - 8.30%	7.95%
WACC	10.1% - 16.7%	13.4%

WACC

MASTEK.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.43	1.03

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.50%	17.40%

Tax rate	23.10%	25.70%
Debt/Equity ratio	0.07	0.07
Cost of debt	7.60%	8.30%

After-tax WACC	10.1%	16.7%


Selected WACC	13.4%

MASTEK.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 MASTEK.NS:

cost_of_equity (13.95%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.43) + 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.