SCHAND.NS WACC - Weighted Average Cost of Capital

The WACC of S Chand and Company Ltd (SCHAND.NS) is 13.8%.

The Cost of Equity of S Chand and Company Ltd (SCHAND.NS) is 15.15%.

The Cost of Debt of S Chand and Company Ltd (SCHAND.NS) is 9.65%.

	Range	Selected
Cost of equity	13.80% - 16.50%	15.15%
Tax rate	20.70% - 46.00%	33.35%
Cost of debt	8.10% - 11.20%	9.65%
WACC	12.7% - 14.8%	13.8%

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	0.84	0.92

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.80%	16.50%

Tax rate	20.70%	46.00%
Debt/Equity ratio	0.18	0.18
Cost of debt	8.10%	11.20%

After-tax WACC	12.7%	14.8%


Selected WACC	13.8%

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 (15.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.84) + 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.