SAIL.NS
Steel Authority of India Ltd
Price:  
121.93 
INR
Volume:  
5,155,189.00
India | Metals & Mining
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SAIL.NS WACC - Weighted Average Cost of Capital

The WACC of Steel Authority of India Ltd (SAIL.NS) is 15.6%.

The Cost of Equity of Steel Authority of India Ltd (SAIL.NS) is 22.15%.
The Cost of Debt of Steel Authority of India Ltd (SAIL.NS) is 8.85%.

Range Selected
Cost of equity 20.60% - 23.70% 22.15%
Tax rate 24.80% - 25.70% 25.25%
Cost of debt 7.70% - 10.00% 8.85%
WACC 14.3% - 16.8% 15.6%
WACC

SAIL.NS WACC calculation

Category Low High
Long-term bond rate 6.9% 7.4%
Equity market risk premium 8.3% 9.3%
Adjusted beta 1.65 1.7
Additional risk adjustments 0.0% 0.5%
Cost of equity 20.60% 23.70%
Tax rate 24.80% 25.70%
Debt/Equity ratio 0.73 0.73
Cost of debt 7.70% 10.00%
After-tax WACC 14.3% 16.8%
Selected WACC 15.6%

SAIL.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 SAIL.NS:

cost_of_equity (22.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.65) + 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.