TIRUMALCHM.NS WACC - Weighted Average Cost of Capital

The WACC of Thirumalai Chemicals Ltd (TIRUMALCHM.NS) is 17.9%.

The Cost of Equity of Thirumalai Chemicals Ltd (TIRUMALCHM.NS) is 17.00%.

The Cost of Debt of Thirumalai Chemicals Ltd (TIRUMALCHM.NS) is 26.20%.

	Range	Selected
Cost of equity	15.10% - 18.90%	17.00%
Tax rate	20.20% - 25.10%	22.65%
Cost of debt	25.50% - 26.90%	26.20%
WACC	16.6% - 19.2%	17.9%

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	0.99	1.18

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.10%	18.90%

Tax rate	20.20%	25.10%
Debt/Equity ratio	0.42	0.42
Cost of debt	25.50%	26.90%

After-tax WACC	16.6%	19.2%


Selected WACC	17.9%

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 (17.00%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.99) + 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.