TIRUMALCHM.NS WACC - Weighted Average Cost of Capital

The WACC of Thirumalai Chemicals Ltd (TIRUMALCHM.NS) is 12.1%.

The Cost of Equity of Thirumalai Chemicals Ltd (TIRUMALCHM.NS) is 17.20%.

The Cost of Debt of Thirumalai Chemicals Ltd (TIRUMALCHM.NS) is 10.70%.

	Range	Selected
Cost of equity	14.50% - 19.90%	17.20%
Tax rate	15.20% - 20.10%	17.65%
Cost of debt	7.00% - 14.40%	10.70%
WACC	9.3% - 14.8%	12.1%

WACC

TIRUMALCHM.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.91	1.29

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.50%	19.90%

Tax rate	15.20%	20.10%
Debt/Equity ratio	1.5	1.5
Cost of debt	7.00%	14.40%

After-tax WACC	9.3%	14.8%


Selected WACC	12.1%

TIRUMALCHM.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 TIRUMALCHM.NS:

cost_of_equity (17.20%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.91) + 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.