The WACC of Mangalam Global Enterprise Ltd (MGEL.NS) is 13.2%.
Range | Selected | |
Cost of equity | 13.8% - 16.9% | 15.35% |
Tax rate | 20.2% - 20.6% | 20.4% |
Cost of debt | 10.2% - 10.5% | 10.35% |
WACC | 12.0% - 14.3% | 13.2% |
Category | Low | High |
Long-term bond rate | 6.9% | 7.4% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 0.83 | 0.98 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 13.8% | 16.9% |
Tax rate | 20.2% | 20.6% |
Debt/Equity ratio | 0.45 | 0.45 |
Cost of debt | 10.2% | 10.5% |
After-tax WACC | 12.0% | 14.3% |
Selected WACC | 13.2% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
MGEL.NS | Mangalam Global Enterprise Ltd | 0.45 | 0.95 | 0.7 |
508494.BO | Warren Tea Ltd | 0.02 | 1.05 | 1.03 |
514197.BO | S & T Corporation Ltd | 0.36 | -0.87 | -0.67 |
524542.BO | Sukhjit Starch and Chemicals Ltd | 0.44 | 1 | 0.74 |
531449.BO | GRM Overseas Ltd | 0.13 | 1.09 | 0.98 |
531982.BO | Spectrum Foods Ltd | 0.01 | 0.49 | 0.48 |
535204.BO | Mukta Agriculture Ltd | 1.01 | 0.63 | 0.35 |
APURE.BK | Agripure Holdings PCL | 0.06 | 0.56 | 0.54 |
DHARSUGAR.NS | Dharani Sugars and Chemicals Ltd | 14.75 | 0.81 | 0.06 |
GAEL.NS | Gujarat Ambuja Exports Ltd | 0.04 | 1.21 | 1.18 |
Low | High | |
Unlevered beta | 0.52 | 0.71 |
Relevered beta | 0.75 | 0.97 |
Adjusted relevered beta | 0.83 | 0.98 |
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 MGEL.NS:
cost_of_equity (15.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.83) + 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.