MUTHOOTCAP.NS WACC - Weighted Average Cost of Capital

The WACC of Muthoot Capital Services Ltd (MUTHOOTCAP.NS) is 13.0%.

The Cost of Equity of Muthoot Capital Services Ltd (MUTHOOTCAP.NS) is 21.40%.

The Cost of Debt of Muthoot Capital Services Ltd (MUTHOOTCAP.NS) is 13.90%.

	Range	Selected
Cost of equity	17.00% - 25.80%	21.40%
Tax rate	25.20% - 25.60%	25.40%
Cost of debt	9.20% - 18.60%	13.90%
WACC	9.3% - 16.7%	13.0%

WACC

MUTHOOTCAP.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.22	1.93

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.00%	25.80%

Tax rate	25.20%	25.60%
Debt/Equity ratio	3.19	3.19
Cost of debt	9.20%	18.60%

After-tax WACC	9.3%	16.7%


Selected WACC	13.0%

MUTHOOTCAP.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 MUTHOOTCAP.NS:

cost_of_equity (21.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.22) + 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.