ONGC.NS
Oil and Natural Gas Corporation Ltd
Price:  
234.19 
INR
Volume:  
14,671,897.00
India | Oil, Gas & Consumable Fuels
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

ONGC.NS WACC - Weighted Average Cost of Capital

The WACC of Oil and Natural Gas Corporation Ltd (ONGC.NS) is 12.0%.

The Cost of Equity of Oil and Natural Gas Corporation Ltd (ONGC.NS) is 15.30%.
The Cost of Debt of Oil and Natural Gas Corporation Ltd (ONGC.NS) is 7.50%.

Range Selected
Cost of equity 12.80% - 17.80% 15.30%
Tax rate 24.50% - 25.70% 25.10%
Cost of debt 6.90% - 8.10% 7.50%
WACC 10.2% - 13.8% 12.0%
WACC

ONGC.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 1.06
Additional risk adjustments 0.0% 0.5%
Cost of equity 12.80% 17.80%
Tax rate 24.50% 25.70%
Debt/Equity ratio 0.52 0.52
Cost of debt 6.90% 8.10%
After-tax WACC 10.2% 13.8%
Selected WACC 12.0%

ONGC.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 ONGC.NS:

cost_of_equity (15.30%) = 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.