PUNJLLOYD.NS WACC - Weighted Average Cost of Capital

The WACC of Punj Lloyd Ltd (PUNJLLOYD.NS) is 18.0%.

The Cost of Equity of Punj Lloyd Ltd (PUNJLLOYD.NS) is 199.60%.

The Cost of Debt of Punj Lloyd Ltd (PUNJLLOYD.NS) is 17.15%.

	Range	Selected
Cost of equity	74.90% - 324.30%	199.60%
Tax rate	2.80% - 4.50%	3.65%
Cost of debt	10.00% - 24.30%	17.15%
WACC	10.2% - 25.8%	18.0%

WACC

PUNJLLOYD.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	6.9%	7.9%
Adjusted beta	9.82	39.95

Additional risk adjustments	0.0%	0.5%
Cost of equity	74.90%	324.30%

Tax rate	2.80%	4.50%
Debt/Equity ratio	114.62	114.62
Cost of debt	10.00%	24.30%

After-tax WACC	10.2%	25.8%


Selected WACC	18.0%

PUNJLLOYD.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 PUNJLLOYD.NS:

cost_of_equity (199.60%) = risk_free_rate (7.15%) + equity_risk_premium (7.40%) * adjusted_beta (9.82) + 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.