PCJEWELLER.NS WACC - Weighted Average Cost of Capital

The WACC of PC Jeweller Ltd (PCJEWELLER.NS) is 10.5%.

The Cost of Equity of PC Jeweller Ltd (PCJEWELLER.NS) is 13.55%.

The Cost of Debt of PC Jeweller Ltd (PCJEWELLER.NS) is 6.40%.

	Range	Selected
Cost of equity	11.40% - 15.70%	13.55%
Tax rate	30.00% - 30.00%	30.00%
Cost of debt	6.40% - 6.40%	6.40%
WACC	9.1% - 11.9%	10.5%

WACC

PCJEWELLER.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.54	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.40%	15.70%

Tax rate	30.00%	30.00%
Debt/Equity ratio	0.51	0.51
Cost of debt	6.40%	6.40%

After-tax WACC	9.1%	11.9%


Selected WACC	10.5%

PCJEWELLER.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 PCJEWELLER.NS:

cost_of_equity (13.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.54) + 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.