PCJEWELLER.NS WACC - Weighted Average Cost of Capital

The WACC of PC Jeweller Ltd (PCJEWELLER.NS) is 11.3%.

The Cost of Equity of PC Jeweller Ltd (PCJEWELLER.NS) is 13.20%.

The Cost of Debt of PC Jeweller Ltd (PCJEWELLER.NS) is 5.75%.

	Range	Selected
Cost of equity	11.80% - 14.60%	13.20%
Tax rate	30.00% - 30.00%	30.00%
Cost of debt	4.00% - 7.50%	5.75%
WACC	10.0% - 12.7%	11.3%

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	0.59	0.72

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.80%	14.60%

Tax rate	30.00%	30.00%
Debt/Equity ratio	0.25	0.25
Cost of debt	4.00%	7.50%

After-tax WACC	10.0%	12.7%


Selected WACC	11.3%

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 (13.20%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.59) + 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.