SPIC.NS WACC - Weighted Average Cost of Capital
The WACC of Southern Petrochemical Industries Corporation Ltd (SPIC.NS) is 16.3%.
| Range | Selected | |
| Cost of equity | 15.5% - 20.8% | 18.15% |
| Tax rate | 6.2% - 17.2% | 11.7% |
| Cost of debt | 7.0% - 13.9% | 10.45% |
| WACC | 13.6% - 18.9% | 16.3% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 1.04 | 1.39 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 15.5% | 20.8% |
| Tax rate | 6.2% | 17.2% |
| Debt/Equity ratio | 0.26 | 0.26 |
| Cost of debt | 7.0% | 13.9% |
| After-tax WACC | 13.6% | 18.9% |
| Selected WACC | 16.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SPIC.NS | Southern Petrochemical Industries Corporation Ltd | 0.26 | 1.03 | 0.83 |
| BHARATRAS.NS | Bharat Rasayan Ltd | 0.02 | 0.62 | 0.61 |
| DHANUKA.NS | Dhanuka Agritech Ltd | 0.01 | 1.47 | 1.46 |
| EXCELINDUS.NS | Excel Industries Ltd | 0 | 1.31 | 1.31 |
| INSECTICID.NS | Insecticides (India) Ltd | 0.03 | 1.28 | 1.24 |
| MADRASFERT.NS | Madras Fertilizers Ltd | 0.48 | 1.99 | 1.37 |
| MANGCHEFER.NS | Mangalore Chemicals and Fertilisers Ltd | 0.32 | 0.68 | 0.53 |
| NACLIND.NS | NACL Industries Ltd | 0.2 | 1.02 | 0.86 |
| NAGAFERT.NS | Nagarjuna Fertilizers and Chemicals Ltd | 9.79 | 0.5 | 0.05 |
| SHARDACROP.NS | Sharda Cropchem Ltd | 0 | 1.78 | 1.78 |
| Low | High | |
| Unlevered beta | 0.85 | 1.27 |
| Relevered beta | 1.06 | 1.58 |
| Adjusted relevered beta | 1.04 | 1.39 |
SPIC.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 SPIC.NS:
cost_of_equity (18.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.04) + 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.