NAHARSPING.NS WACC - Weighted Average Cost of Capital

The WACC of Nahar Spinning Mills Ltd (NAHARSPING.NS) is 13.1%.

The Cost of Equity of Nahar Spinning Mills Ltd (NAHARSPING.NS) is 18.85%.

The Cost of Debt of Nahar Spinning Mills Ltd (NAHARSPING.NS) is 11.05%.

	Range	Selected
Cost of equity	17.30% - 20.40%	18.85%
Tax rate	24.40% - 25.90%	25.15%
Cost of debt	6.70% - 15.40%	11.05%
WACC	10.7% - 15.6%	13.1%

WACC

NAHARSPING.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.25	1.35

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.30%	20.40%

Tax rate	24.40%	25.90%
Debt/Equity ratio	1.17	1.17
Cost of debt	6.70%	15.40%

After-tax WACC	10.7%	15.6%


Selected WACC	13.1%

NAHARSPING.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 NAHARSPING.NS:

cost_of_equity (18.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.25) + 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.