SADBHAV.NS
Sadbhav Engineering Ltd
Price:  
14.05 
INR
Volume:  
680,301.00
India | Construction & Engineering
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SADBHAV.NS WACC - Weighted Average Cost of Capital

The WACC of Sadbhav Engineering Ltd (SADBHAV.NS) is 15.2%.

The Cost of Equity of Sadbhav Engineering Ltd (SADBHAV.NS) is 88.30%.
The Cost of Debt of Sadbhav Engineering Ltd (SADBHAV.NS) is 10.90%.

Range Selected
Cost of equity 74.40% - 102.20% 88.30%
Tax rate 1.50% - 2.00% 1.75%
Cost of debt 9.70% - 12.10% 10.90%
WACC 13.3% - 17.1% 15.2%
WACC

SADBHAV.NS WACC calculation

Category Low High
Long-term bond rate 6.9% 7.4%
Equity market risk premium 8.3% 9.3%
Adjusted beta 8.13 10.14
Additional risk adjustments 0.0% 0.5%
Cost of equity 74.40% 102.20%
Tax rate 1.50% 2.00%
Debt/Equity ratio 16.43 16.43
Cost of debt 9.70% 12.10%
After-tax WACC 13.3% 17.1%
Selected WACC 15.2%

SADBHAV.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 SADBHAV.NS:

cost_of_equity (88.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (8.13) + 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.