NELCAST.NS WACC - Weighted Average Cost of Capital

The WACC of Nelcast Ltd (NELCAST.NS) is 12.1%.

The Cost of Equity of Nelcast Ltd (NELCAST.NS) is 12.80%.

The Cost of Debt of Nelcast Ltd (NELCAST.NS) is 12.25%.

	Range	Selected
Cost of equity	10.70% - 14.90%	12.80%
Tax rate	25.00% - 25.70%	25.35%
Cost of debt	10.50% - 14.00%	12.25%
WACC	10.1% - 14.0%	12.1%

WACC

NELCAST.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.47	0.76

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.70%	14.90%

Tax rate	25.00%	25.70%
Debt/Equity ratio	0.26	0.26
Cost of debt	10.50%	14.00%

After-tax WACC	10.1%	14.0%


Selected WACC	12.1%

NELCAST.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 NELCAST.NS:

cost_of_equity (12.80%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.47) + 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.