PIONEEREMB.NS WACC - Weighted Average Cost of Capital

The WACC of Pioneer Embroideries Ltd (PIONEEREMB.NS) is 13.3%.

The Cost of Equity of Pioneer Embroideries Ltd (PIONEEREMB.NS) is 15.55%.

The Cost of Debt of Pioneer Embroideries Ltd (PIONEEREMB.NS) is 13.20%.

	Range	Selected
Cost of equity	13.80% - 17.30%	15.55%
Tax rate	17.40% - 21.80%	19.60%
Cost of debt	11.00% - 15.40%	13.20%
WACC	11.6% - 14.9%	13.3%

WACC

PIONEEREMB.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.83	1.02

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.80%	17.30%

Tax rate	17.40%	21.80%
Debt/Equity ratio	0.82	0.82
Cost of debt	11.00%	15.40%

After-tax WACC	11.6%	14.9%


Selected WACC	13.3%

PIONEEREMB.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 PIONEEREMB.NS:

cost_of_equity (15.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.83) + 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.