TIRUPATIFL.NS WACC - Weighted Average Cost of Capital

The WACC of Tirupati Forge Ltd (TIRUPATIFL.NS) is 11.8%.

The Cost of Equity of Tirupati Forge Ltd (TIRUPATIFL.NS) is 11.95%.

The Cost of Debt of Tirupati Forge Ltd (TIRUPATIFL.NS) is 9.35%.

	Range	Selected
Cost of equity	10.60% - 13.30%	11.95%
Tax rate	25.60% - 26.50%	26.05%
Cost of debt	7.80% - 10.90%	9.35%
WACC	10.4% - 13.2%	11.8%

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	0.45	0.59

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.60%	13.30%

Tax rate	25.60%	26.50%
Debt/Equity ratio	0.03	0.03
Cost of debt	7.80%	10.90%

After-tax WACC	10.4%	13.2%


Selected WACC	11.8%

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 (11.95%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.45) + 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.