REVATHI.NS WACC - Weighted Average Cost of Capital

The WACC of Revathi Equipment Ltd (REVATHI.NS) is 19.9%.

The Cost of Equity of Revathi Equipment Ltd (REVATHI.NS) is 14.20%.

The Cost of Debt of Revathi Equipment Ltd (REVATHI.NS) is 225.35%.

	Range	Selected
Cost of equity	12.50% - 15.90%	14.20%
Tax rate	25.70% - 27.60%	26.65%
Cost of debt	8.70% - 442.00%	225.35%
WACC	12.3% - 27.6%	19.9%

WACC

REVATHI.NS WACC calculation

Category	Low	High

Long-term bond rate	7.2%	7.7%
Equity market risk premium	8.8%	9.8%
Adjusted beta	0.6	0.78

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.50%	15.90%

Tax rate	25.70%	27.60%
Debt/Equity ratio	0.04	0.04
Cost of debt	8.70%	442.00%

After-tax WACC	12.3%	27.6%


Selected WACC	19.9%

REVATHI.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 REVATHI.NS:

cost_of_equity (14.20%) = risk_free_rate (7.45%) + equity_risk_premium (9.30%) * adjusted_beta (0.6) + 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.