The WACC of Tourism Finance Corporation of India Ltd (TFCILTD.NS) is 8.3%.
Range | Selected | |
Cost of equity | 9.7% - 11.4% | 10.55% |
Tax rate | 19.4% - 19.7% | 19.55% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 7.8% - 8.9% | 8.3% |
Category | Low | High |
Long-term bond rate | 6.9% | 7.4% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 0.35 | 0.38 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.7% | 11.4% |
Tax rate | 19.4% | 19.7% |
Debt/Equity ratio | 0.52 | 0.52 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 7.8% | 8.9% |
Selected WACC | 8.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
TFCILTD.NS | Tourism Finance Corporation of India Ltd | 0.52 | 1.45 | 1.02 |
508969.BO | Sulabh Engineers and Services Ltd | 0.04 | -0.2 | -0.2 |
511724.BO | Baid Leasing and Finance Co Ltd | 0.44 | 0.07 | 0.05 |
512381.BO | Starteck Finance Ltd | 4.97 | -0.93 | -0.19 |
530067.BO | CSL Finance Ltd | 0.42 | 0.76 | 0.57 |
530879.BO | Capital India Finance Ltd | 0.67 | 0.83 | 0.54 |
532057.BO | Abhinav Capital Services Ltd | 0.43 | -1.48 | -1.09 |
535566.BO | KIFS Financial Services Ltd | 2.12 | 0.01 | 0 |
538732.BO | Vibrant Global Capital Ltd | 0.3 | 0.11 | 0.09 |
VIJIFIN.NS | Viji Finance Ltd | 0.35 | 0.03 | 0.03 |
Low | High | |
Unlevered beta | 0.02 | 0.06 |
Relevered beta | 0.03 | 0.07 |
Adjusted relevered beta | 0.35 | 0.38 |
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 TFCILTD.NS:
cost_of_equity (10.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.35) + 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.