NH.NS WACC - Weighted Average Cost of Capital
The WACC of Narayana Hrudayalaya Ltd (NH.NS) is 12.5%.
| Range | Selected | |
| Cost of equity | 11.2% - 14.2% | 12.7% |
| Tax rate | 17.8% - 19.7% | 18.75% |
| Cost of debt | 7.8% - 8.1% | 7.95% |
| WACC | 11.1% - 13.9% | 12.5% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.53 | 0.68 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.2% | 14.2% |
| Tax rate | 17.8% | 19.7% |
| Debt/Equity ratio | 0.04 | 0.04 |
| Cost of debt | 7.8% | 8.1% |
| After-tax WACC | 11.1% | 13.9% |
| Selected WACC | 12.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| NH.NS | Narayana Hrudayalaya Ltd | 0.04 | 0.57 | 0.55 |
| 523696.BO | Fortis Malar Hospitals Ltd | 0.34 | 0.32 | 0.25 |
| 524520.BO | KMC Speciality Hospitals India Ltd | 0.08 | 0.65 | 0.61 |
| 530897.BO | N G Industries Ltd | 0.01 | 0.31 | 0.31 |
| EHE.AX | Estia Health Ltd | 0.16 | -0.27 | -0.24 |
| HCG.NS | Healthcare Global Enterprises Ltd | 0.16 | 0.53 | 0.47 |
| INDRAMEDCO.NS | Indraprastha Medical Corporation Ltd | 0.01 | 1.7 | 1.69 |
| RAM.BK | Ramkhamhaeng Hospital PCL | 0.56 | 0.31 | 0.21 |
| SHALBY.NS | Shalby Ltd | 0.24 | 1.2 | 1.01 |
| SVH.BK | Samitivej PCL | 0.01 | 0.23 | 0.23 |
| Low | High | |
| Unlevered beta | 0.28 | 0.5 |
| Relevered beta | 0.3 | 0.52 |
| Adjusted relevered beta | 0.53 | 0.68 |
NH.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 NH.NS:
cost_of_equity (12.70%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.53) + 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.