SARLAPOLY.NS WACC - Weighted Average Cost of Capital

The WACC of Sarla Performance Fibers Ltd (SARLAPOLY.NS) is 12.9%.

The Cost of Equity of Sarla Performance Fibers Ltd (SARLAPOLY.NS) is 14.55%.

The Cost of Debt of Sarla Performance Fibers Ltd (SARLAPOLY.NS) is 6.35%.

	Range	Selected
Cost of equity	13.00% - 16.10%	14.55%
Tax rate	26.50% - 27.50%	27.00%
Cost of debt	4.90% - 7.80%	6.35%
WACC	11.4% - 14.3%	12.9%

WACC

SARLAPOLY.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.74	0.88

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.00%	16.10%

Tax rate	26.50%	27.50%
Debt/Equity ratio	0.21	0.21
Cost of debt	4.90%	7.80%

After-tax WACC	11.4%	14.3%


Selected WACC	12.9%

SARLAPOLY.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 SARLAPOLY.NS:

cost_of_equity (14.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.74) + 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.