RANEHOLDIN.NS WACC - Weighted Average Cost of Capital
The WACC of Rane Holdings Ltd (RANEHOLDIN.NS) is 14.8%.
| Range | Selected | |
| Cost of equity | 16.7% - 20.3% | 18.5% |
| Tax rate | 30.0% - 30.0% | 30% |
| Cost of debt | 6.3% - 10.0% | 8.15% |
| WACC | 13.1% - 16.4% | 14.8% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 1.19 | 1.33 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 16.7% | 20.3% |
| Tax rate | 30.0% | 30.0% |
| Debt/Equity ratio | 0.41 | 0.41 |
| Cost of debt | 6.3% | 10.0% |
| After-tax WACC | 13.1% | 16.4% |
| Selected WACC | 14.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| RANEHOLDIN.NS | Rane Holdings Ltd | 0.41 | 1.22 | 0.95 |
| GABRIEL.NS | Gabriel India Ltd | 0.01 | 1.96 | 1.95 |
| JAYBARMARU.NS | Jay Bharat Maruti Ltd | 0.59 | 0.94 | 0.66 |
| JBMA.NS | JBM Auto Ltd | 0.13 | 1.7 | 1.56 |
| LUMAXIND.NS | Lumax Industries Ltd | 0.29 | 0.98 | 0.81 |
| MINDACORP.NS | Minda Corporation Ltd | 0.04 | 1.06 | 1.03 |
| SANDHAR.NS | Sandhar Technologies Ltd | 0.29 | 1.36 | 1.13 |
| SSWL.NS | Steel Strips Wheels Ltd | 0.29 | 0.85 | 0.7 |
| SUBROS.NS | Subros Ltd | 0 | 1.43 | 1.43 |
| WHEELS.NS | Wheels India Ltd | 0.43 | 1.56 | 1.2 |
| Low | High | |
| Unlevered beta | 0.99 | 1.16 |
| Relevered beta | 1.28 | 1.49 |
| Adjusted relevered beta | 1.19 | 1.33 |
RANEHOLDIN.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 RANEHOLDIN.NS:
cost_of_equity (18.50%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.19) + 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.