PGEL.NS WACC - Weighted Average Cost of Capital

The WACC of PG Electroplast Ltd (PGEL.NS) is 12.1%.

The Cost of Equity of PG Electroplast Ltd (PGEL.NS) is 12.20%.

The Cost of Debt of PG Electroplast Ltd (PGEL.NS) is 9.40%.

	Range	Selected
Cost of equity	11.10% - 13.30%	12.20%
Tax rate	22.90% - 23.40%	23.15%
Cost of debt	8.10% - 10.70%	9.40%
WACC	11.0% - 13.2%	12.1%

WACC

PGEL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.51	0.59

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.10%	13.30%

Tax rate	22.90%	23.40%
Debt/Equity ratio	0.02	0.02
Cost of debt	8.10%	10.70%

After-tax WACC	11.0%	13.2%


Selected WACC	12.1%

PGEL.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 PGEL.NS:

cost_of_equity (12.20%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.51) + 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.