TEXMOPIPES.NS WACC - Weighted Average Cost of Capital

The WACC of Texmo Pipes and Products Ltd (TEXMOPIPES.NS) is 15.4%.

The Cost of Equity of Texmo Pipes and Products Ltd (TEXMOPIPES.NS) is 16.30%.

The Cost of Debt of Texmo Pipes and Products Ltd (TEXMOPIPES.NS) is 17.25%.

	Range	Selected
Cost of equity	14.20% - 18.40%	16.30%
Tax rate	24.90% - 28.20%	26.55%
Cost of debt	8.60% - 25.90%	17.25%
WACC	12.3% - 18.5%	15.4%

WACC

TEXMOPIPES.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.89	1.13

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.20%	18.40%

Tax rate	24.90%	28.20%
Debt/Equity ratio	0.34	0.34
Cost of debt	8.60%	25.90%

After-tax WACC	12.3%	18.5%


Selected WACC	15.4%

TEXMOPIPES.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 TEXMOPIPES.NS:

cost_of_equity (16.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.89) + 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.