PDPL.NS
Parenteral Drugs (India) Ltd
Price:  
2.9 
INR
Volume:  
6,790
India | Pharmaceuticals

PDPL.NS WACC - Weighted Average Cost of Capital

The WACC of Parenteral Drugs (India) Ltd (PDPL.NS) is 12.0%.

The Cost of Equity of Parenteral Drugs (India) Ltd (PDPL.NS) is 54%.
The Cost of Debt of Parenteral Drugs (India) Ltd (PDPL.NS) is 11.8%.

RangeSelected
Cost of equity37.7% - 70.3%54%
Tax rate25.6% - 27.1%26.35%
Cost of debt7.0% - 16.6%11.8%
WACC7.6% - 16.4%12.0%
WACC

PDPL.NS WACC calculation

CategoryLowHigh
Long-term bond rate6.9%7.4%
Equity market risk premium8.3%9.3%
Adjusted beta3.716.71
Additional risk adjustments0.0%0.5%
Cost of equity37.7%70.3%
Tax rate25.6%27.1%
Debt/Equity ratio
12.412.4
Cost of debt7.0%16.6%
After-tax WACC7.6%16.4%
Selected WACC12.0%

PDPL.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 PDPL.NS:

cost_of_equity (54.00%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (3.71) + 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.