PHOENIXLTD.NS WACC - Weighted Average Cost of Capital

The WACC of Phoenix Mills Ltd (PHOENIXLTD.NS) is 14.6%.

The Cost of Equity of Phoenix Mills Ltd (PHOENIXLTD.NS) is 15.30%.

The Cost of Debt of Phoenix Mills Ltd (PHOENIXLTD.NS) is 8.25%.

	Range	Selected
Cost of equity	11.50% - 19.10%	15.30%
Tax rate	18.00% - 21.30%	19.65%
Cost of debt	8.10% - 8.40%	8.25%
WACC	11.1% - 18.1%	14.6%

WACC

PHOENIXLTD.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.56	1.2

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.50%	19.10%

Tax rate	18.00%	21.30%
Debt/Equity ratio	0.08	0.08
Cost of debt	8.10%	8.40%

After-tax WACC	11.1%	18.1%


Selected WACC	14.6%

PHOENIXLTD.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 PHOENIXLTD.NS:

cost_of_equity (15.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.56) + 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.