SANGHIIND.NS WACC - Weighted Average Cost of Capital

The WACC of Sanghi Industries Ltd (SANGHIIND.NS) is 13.1%.

The Cost of Equity of Sanghi Industries Ltd (SANGHIIND.NS) is 18.20%.

The Cost of Debt of Sanghi Industries Ltd (SANGHIIND.NS) is 10.50%.

	Range	Selected
Cost of equity	16.00% - 20.40%	18.20%
Tax rate	4.80% - 16.10%	10.45%
Cost of debt	7.00% - 14.00%	10.50%
WACC	10.7% - 15.5%	13.1%

WACC

SANGHIIND.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.1	1.34

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.00%	20.40%

Tax rate	4.80%	16.10%
Debt/Equity ratio	1.31	1.31
Cost of debt	7.00%	14.00%

After-tax WACC	10.7%	15.5%


Selected WACC	13.1%

SANGHIIND.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 SANGHIIND.NS:

cost_of_equity (18.20%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.1) + 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.