PATSPINLTD.NS WACC - Weighted Average Cost of Capital

The WACC of Patspin India Ltd (PATSPINLTD.NS) is 8.1%.

The Cost of Equity of Patspin India Ltd (PATSPINLTD.NS) is 14.25%.

The Cost of Debt of Patspin India Ltd (PATSPINLTD.NS) is 8.80%.

	Range	Selected
Cost of equity	10.70% - 17.80%	14.25%
Tax rate	23.30% - 27.70%	25.50%
Cost of debt	7.00% - 10.60%	8.80%
WACC	6.5% - 9.8%	8.1%

WACC

PATSPINLTD.NS WACC calculation

Category	Low	High

Long-term bond rate	7.5%	8.0%
Equity market risk premium	6.9%	7.9%
Adjusted beta	0.46	1.17

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.70%	17.80%

Tax rate	23.30%	27.70%
Debt/Equity ratio	3.76	3.76
Cost of debt	7.00%	10.60%

After-tax WACC	6.5%	9.8%


Selected WACC	8.1%

PATSPINLTD.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 PATSPINLTD.NS:

cost_of_equity (14.25%) = risk_free_rate (7.75%) + equity_risk_premium (7.40%) * adjusted_beta (0.46) + 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.