NESTLEIND.NS
Nestle India Ltd
Price:  
2,458.70 
INR
Volume:  
1,187,836.00
India | Food Products
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NESTLEIND.NS WACC - Weighted Average Cost of Capital

The WACC of Nestle India Ltd (NESTLEIND.NS) is 14.1%.

The Cost of Equity of Nestle India Ltd (NESTLEIND.NS) is 14.15%.
The Cost of Debt of Nestle India Ltd (NESTLEIND.NS) is 8.65%.

Range Selected
Cost of equity 12.80% - 15.50% 14.15%
Tax rate 25.70% - 25.80% 25.75%
Cost of debt 7.50% - 9.80% 8.65%
WACC 12.7% - 15.5% 14.1%
WACC

NESTLEIND.NS WACC calculation

Category Low High
Long-term bond rate 6.9% 7.4%
Equity market risk premium 8.3% 9.3%
Adjusted beta 0.71 0.82
Additional risk adjustments 0.0% 0.5%
Cost of equity 12.80% 15.50%
Tax rate 25.70% 25.80%
Debt/Equity ratio 0 0
Cost of debt 7.50% 9.80%
After-tax WACC 12.7% 15.5%
Selected WACC 14.1%

NESTLEIND.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 NESTLEIND.NS:

cost_of_equity (14.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.71) + 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.