PFS.NS WACC - Weighted Average Cost of Capital

The WACC of PTC India Financial Services Ltd (PFS.NS) is 12.7%.

The Cost of Equity of PTC India Financial Services Ltd (PFS.NS) is 15.95%.

The Cost of Debt of PTC India Financial Services Ltd (PFS.NS) is 13.05%.

	Range	Selected
Cost of equity	13.40% - 18.50%	15.95%
Tax rate	23.40% - 24.70%	24.05%
Cost of debt	7.50% - 18.60%	13.05%
WACC	9.4% - 16.1%	12.7%

WACC

PFS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.79	1.14

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.40%	18.50%

Tax rate	23.40%	24.70%
Debt/Equity ratio	1.12	1.12
Cost of debt	7.50%	18.60%

After-tax WACC	9.4%	16.1%


Selected WACC	12.7%

PFS.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 PFS.NS:

cost_of_equity (15.95%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.79) + 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.