TIRUPATIFL.NS WACC - Weighted Average Cost of Capital

The WACC of Tirupati Forge Ltd (TIRUPATIFL.NS) is 11.1%.

The Cost of Equity of Tirupati Forge Ltd (TIRUPATIFL.NS) is 11.35%.

The Cost of Debt of Tirupati Forge Ltd (TIRUPATIFL.NS) is 9.50%.

	Range	Selected
Cost of equity	10.20% - 12.50%	11.35%
Tax rate	25.40% - 25.60%	25.50%
Cost of debt	7.90% - 11.10%	9.50%
WACC	10.0% - 12.2%	11.1%

WACC

TIRUPATIFL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.4	0.49

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.20%	12.50%

Tax rate	25.40%	25.60%
Debt/Equity ratio	0.06	0.06
Cost of debt	7.90%	11.10%

After-tax WACC	10.0%	12.2%


Selected WACC	11.1%

TIRUPATIFL.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 TIRUPATIFL.NS:

cost_of_equity (11.35%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.4) + 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.