PRADIP.NS WACC - Weighted Average Cost of Capital
The WACC of Pradip Overseas Ltd (PRADIP.NS) is 4.3%.
| Range | Selected | |
| Cost of equity | 98.2% - 170.2% | 134.2% |
| Tax rate | 30.0% - 31.8% | 30.9% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 3.2% - 5.4% | 4.3% |
| Category | Low | High |
| Long-term bond rate | 7.5% | 8.0% |
| Equity market risk premium | 6.9% | 7.9% |
| Adjusted beta | 13.1 | 20.41 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 98.2% | 170.2% |
| Tax rate | 30.0% | 31.8% |
| Debt/Equity ratio | 257.36 | 257.36 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 3.2% | 5.4% |
| Selected WACC | 4.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PRADIP.NS | Pradip Overseas Ltd | 257.36 | 0 | 0 |
| 500192.BO | Prag Bosimi Synthetics Ltd | 9.17 | 0.67 | 0.09 |
| 514010.BO | Himachal Fibres Ltd | 0.01 | 0.72 | 0.71 |
| 514140.BO | Suryavanshi Spinning Mills Ltd | 1.46 | 0.29 | 0.14 |
| 514266.BO | Zenith Fibres Ltd | 0 | 0.79 | 0.79 |
| 521242.BO | Kandagiri Spinning Millis Ltd | 1.1 | -0.52 | -0.29 |
| 531411.BO | Tuni Textile Mills Ltd | 0.91 | -0.03 | -0.02 |
| 531744.BO | Gini Silk Mills Ltd | 0.1 | -0.13 | -0.12 |
| 540148.BO | Bindal Exports Ltd | 0.8 | 3.55 | 2.27 |
| EUROTEXIND.NS | Eurotex Industries and Exports Ltd | 3.06 | -0.83 | -0.26 |
| SOMATEX.NS | Soma Textiles & Industries Ltd | 0.02 | 1.1 | 1.09 |
| Low | High | |
| Unlevered beta | 0 | 0.14 |
| Relevered beta | 19.06 | 29.97 |
| Adjusted relevered beta | 13.1 | 20.41 |
PRADIP.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 PRADIP.NS:
cost_of_equity (134.20%) = risk_free_rate (7.75%) + equity_risk_premium (7.40%) * adjusted_beta (13.1) + 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.