TATASTLLP.NS
Tata Steel Long Products Ltd
Price:  
829.35 
INR
Volume:  
237,902
India | Metals & Mining

TATASTLLP.NS WACC - Weighted Average Cost of Capital

The WACC of Tata Steel Long Products Ltd (TATASTLLP.NS) is 11.3%.

The Cost of Equity of Tata Steel Long Products Ltd (TATASTLLP.NS) is 31.55%.
The Cost of Debt of Tata Steel Long Products Ltd (TATASTLLP.NS) is 7%.

RangeSelected
Cost of equity26.6% - 36.5%31.55%
Tax rate8.3% - 16.2%12.25%
Cost of debt7.0% - 7.0%7%
WACC10.5% - 12.1%11.3%
WACC

TATASTLLP.NS WACC calculation

CategoryLowHigh
Long-term bond rate6.9%7.4%
Equity market risk premium8.3%9.3%
Adjusted beta2.373.07
Additional risk adjustments0.0%0.5%
Cost of equity26.6%36.5%
Tax rate8.3%16.2%
Debt/Equity ratio
3.953.95
Cost of debt7.0%7.0%
After-tax WACC10.5%12.1%
Selected WACC11.3%

TATASTLLP.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 TATASTLLP.NS:

cost_of_equity (31.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (2.37) + 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.