TATAMETALI.NS WACC - Weighted Average Cost of Capital

The WACC of Tata Metaliks Ltd (TATAMETALI.NS) is 15.8%.

The Cost of Equity of Tata Metaliks Ltd (TATAMETALI.NS) is 15.85%.

The Cost of Debt of Tata Metaliks Ltd (TATAMETALI.NS) is 20.10%.

	Range	Selected
Cost of equity	14.50% - 17.20%	15.85%
Tax rate	19.00% - 23.20%	21.10%
Cost of debt	9.10% - 31.10%	20.10%
WACC	14.2% - 17.4%	15.8%

WACC

TATAMETALI.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.92	1

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.50%	17.20%

Tax rate	19.00%	23.20%
Debt/Equity ratio	0.04	0.04
Cost of debt	9.10%	31.10%

After-tax WACC	14.2%	17.4%


Selected WACC	15.8%

TATAMETALI.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 TATAMETALI.NS:

cost_of_equity (15.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.92) + 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.