MBAPL.NS WACC - Weighted Average Cost of Capital

The WACC of Madhya Bharat Agro Products Ltd (MBAPL.NS) is 11.3%.

The Cost of Equity of Madhya Bharat Agro Products Ltd (MBAPL.NS) is 11.55%.

The Cost of Debt of Madhya Bharat Agro Products Ltd (MBAPL.NS) is 12.40%.

	Range	Selected
Cost of equity	10.10% - 13.00%	11.55%
Tax rate	29.70% - 33.60%	31.65%
Cost of debt	8.30% - 16.50%	12.40%
WACC	9.8% - 12.9%	11.3%

WACC

MBAPL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.39	0.56

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.10%	13.00%

Tax rate	29.70%	33.60%
Debt/Equity ratio	0.09	0.09
Cost of debt	8.30%	16.50%

After-tax WACC	9.8%	12.9%


Selected WACC	11.3%

MBAPL.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 MBAPL.NS:

cost_of_equity (11.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.39) + 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.