RPPINFRA.NS WACC - Weighted Average Cost of Capital

The WACC of RPP Infra Projects Ltd (RPPINFRA.NS) is 13.4%.

The Cost of Equity of RPP Infra Projects Ltd (RPPINFRA.NS) is 14.65%.

The Cost of Debt of RPP Infra Projects Ltd (RPPINFRA.NS) is 9.45%.

	Range	Selected
Cost of equity	12.40% - 16.90%	14.65%
Tax rate	31.50% - 37.70%	34.60%
Cost of debt	7.80% - 11.10%	9.45%
WACC	11.4% - 15.5%	13.4%

WACC

RPPINFRA.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.67	0.97

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.40%	16.90%

Tax rate	31.50%	37.70%
Debt/Equity ratio	0.17	0.17
Cost of debt	7.80%	11.10%

After-tax WACC	11.4%	15.5%


Selected WACC	13.4%

RPPINFRA.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 RPPINFRA.NS:

cost_of_equity (14.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.67) + 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.