SWELECTES.NS WACC - Weighted Average Cost of Capital

The WACC of Swelect Energy Systems Ltd (SWELECTES.NS) is 14.5%.

The Cost of Equity of Swelect Energy Systems Ltd (SWELECTES.NS) is 19.15%.

The Cost of Debt of Swelect Energy Systems Ltd (SWELECTES.NS) is 9.35%.

	Range	Selected
Cost of equity	16.90% - 21.40%	19.15%
Tax rate	7.40% - 9.70%	8.55%
Cost of debt	8.20% - 10.50%	9.35%
WACC	12.9% - 16.2%	14.5%

WACC

SWELECTES.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.21	1.45

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.90%	21.40%

Tax rate	7.40%	9.70%
Debt/Equity ratio	0.77	0.77
Cost of debt	8.20%	10.50%

After-tax WACC	12.9%	16.2%


Selected WACC	14.5%

SWELECTES.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 SWELECTES.NS:

cost_of_equity (19.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.21) + 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.