NECCLTD.NS WACC - Weighted Average Cost of Capital

The WACC of North Eastern Carrying Corporation Ltd (NECCLTD.NS) is 11.8%.

The Cost of Equity of North Eastern Carrying Corporation Ltd (NECCLTD.NS) is 15.25%.

The Cost of Debt of North Eastern Carrying Corporation Ltd (NECCLTD.NS) is 5.00%.

	Range	Selected
Cost of equity	13.00% - 17.50%	15.25%
Tax rate	23.60% - 25.90%	24.75%
Cost of debt	5.00% - 5.00%	5.00%
WACC	10.2% - 13.4%	11.8%

WACC

NECCLTD.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.74	1.03

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.00%	17.50%

Tax rate	23.60%	25.90%
Debt/Equity ratio	0.43	0.43
Cost of debt	5.00%	5.00%

After-tax WACC	10.2%	13.4%


Selected WACC	11.8%

NECCLTD.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 NECCLTD.NS:

cost_of_equity (15.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.74) + 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.