SHRADHA.NS WACC - Weighted Average Cost of Capital

The WACC of Shradha Infraprojects Ltd (SHRADHA.NS) is 9.3%.

The Cost of Equity of Shradha Infraprojects Ltd (SHRADHA.NS) is 11.70%.

The Cost of Debt of Shradha Infraprojects Ltd (SHRADHA.NS) is 5.75%.

	Range	Selected
Cost of equity	9.80% - 13.60%	11.70%
Tax rate	21.20% - 23.80%	22.50%
Cost of debt	4.00% - 7.50%	5.75%
WACC	7.6% - 10.9%	9.3%

WACC

SHRADHA.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.36	0.62

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.80%	13.60%

Tax rate	21.20%	23.80%
Debt/Equity ratio	0.51	0.51
Cost of debt	4.00%	7.50%

After-tax WACC	7.6%	10.9%


Selected WACC	9.3%

SHRADHA.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 SHRADHA.NS:

cost_of_equity (11.70%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.36) + 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.