SCHAND.NS WACC - Weighted Average Cost of Capital

The WACC of S Chand and Company Ltd (SCHAND.NS) is 14.5%.

The Cost of Equity of S Chand and Company Ltd (SCHAND.NS) is 15.85%.

The Cost of Debt of S Chand and Company Ltd (SCHAND.NS) is 8.55%.

	Range	Selected
Cost of equity	14.30% - 17.40%	15.85%
Tax rate	30.00% - 30.00%	30.00%
Cost of debt	7.80% - 9.30%	8.55%
WACC	13.1% - 15.9%	14.5%

WACC

SCHAND.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.9	1.02

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.30%	17.40%

Tax rate	30.00%	30.00%
Debt/Equity ratio	0.16	0.16
Cost of debt	7.80%	9.30%

After-tax WACC	13.1%	15.9%


Selected WACC	14.5%

SCHAND.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 SCHAND.NS:

cost_of_equity (15.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.9) + 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.