RAJSREESUG.NS WACC - Weighted Average Cost of Capital

The WACC of Rajshree Sugars & Chemicals Ltd (RAJSREESUG.NS) is 6.9%.

The Cost of Equity of Rajshree Sugars & Chemicals Ltd (RAJSREESUG.NS) is 15.20%.

The Cost of Debt of Rajshree Sugars & Chemicals Ltd (RAJSREESUG.NS) is 5.00%.

	Range	Selected
Cost of equity	12.20% - 18.20%	15.20%
Tax rate	26.90% - 31.80%	29.35%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.1% - 7.7%	6.9%

WACC

RAJSREESUG.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.64	1.12

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.20%	18.20%

Tax rate	26.90%	31.80%
Debt/Equity ratio	2.43	2.43
Cost of debt	5.00%	5.00%

After-tax WACC	6.1%	7.7%


Selected WACC	6.9%

RAJSREESUG.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 RAJSREESUG.NS:

cost_of_equity (15.20%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.64) + 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.