SUDARSCHEM.NS WACC - Weighted Average Cost of Capital

The WACC of Sudarshan Chemical Industries Ltd (SUDARSCHEM.NS) is 13.3%.

The Cost of Equity of Sudarshan Chemical Industries Ltd (SUDARSCHEM.NS) is 15.35%.

The Cost of Debt of Sudarshan Chemical Industries Ltd (SUDARSCHEM.NS) is 10.20%.

	Range	Selected
Cost of equity	14.20% - 16.50%	15.35%
Tax rate	24.70% - 30.80%	27.75%
Cost of debt	10.00% - 10.40%	10.20%
WACC	12.5% - 14.1%	13.3%

WACC

SUDARSCHEM.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.88	0.93

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.20%	16.50%

Tax rate	24.70%	30.80%
Debt/Equity ratio	0.34	0.34
Cost of debt	10.00%	10.40%

After-tax WACC	12.5%	14.1%


Selected WACC	13.3%

SUDARSCHEM.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 SUDARSCHEM.NS:

cost_of_equity (15.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.88) + 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.