SUBROS.NS WACC - Weighted Average Cost of Capital

The WACC of Subros Ltd (SUBROS.NS) is 17.5%.

The Cost of Equity of Subros Ltd (SUBROS.NS) is 17.50%.

The Cost of Debt of Subros Ltd (SUBROS.NS) is 42.60%.

	Range	Selected
Cost of equity	15.80% - 19.20%	17.50%
Tax rate	27.40% - 29.20%	28.30%
Cost of debt	7.50% - 77.70%	42.60%
WACC	15.8% - 19.2%	17.5%

WACC

SUBROS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.08	1.22

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.80%	19.20%

Tax rate	27.40%	29.20%
Debt/Equity ratio	0	0
Cost of debt	7.50%	77.70%

After-tax WACC	15.8%	19.2%


Selected WACC	17.5%

SUBROS.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 SUBROS.NS:

cost_of_equity (17.50%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.08) + 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.