SAKHTISUG.NS WACC - Weighted Average Cost of Capital

The WACC of Sakthi Sugars Ltd (SAKHTISUG.NS) is 14.0%.

The Cost of Equity of Sakthi Sugars Ltd (SAKHTISUG.NS) is 28.15%.

The Cost of Debt of Sakthi Sugars Ltd (SAKHTISUG.NS) is 9.60%.

	Range	Selected
Cost of equity	25.10% - 31.20%	28.15%
Tax rate	7.70% - 18.10%	12.90%
Cost of debt	7.10% - 12.10%	9.60%
WACC	11.9% - 16.1%	14.0%

WACC

SAKHTISUG.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	2.19	2.51

Additional risk adjustments	0.0%	0.5%
Cost of equity	25.10%	31.20%

Tax rate	7.70%	18.10%
Debt/Equity ratio	2.45	2.45
Cost of debt	7.10%	12.10%

After-tax WACC	11.9%	16.1%


Selected WACC	14.0%

SAKHTISUG.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 SAKHTISUG.NS:

cost_of_equity (28.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (2.19) + 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.