TOKYOPLAST.NS WACC - Weighted Average Cost of Capital

The WACC of Tokyo Plast International Ltd (TOKYOPLAST.NS) is 11.9%.

The Cost of Equity of Tokyo Plast International Ltd (TOKYOPLAST.NS) is 13.25%.

The Cost of Debt of Tokyo Plast International Ltd (TOKYOPLAST.NS) is 8.10%.

	Range	Selected
Cost of equity	12.00% - 14.50%	13.25%
Tax rate	22.70% - 29.90%	26.30%
Cost of debt	6.20% - 10.00%	8.10%
WACC	10.7% - 13.2%	11.9%

WACC

TOKYOPLAST.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.62	0.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.00%	14.50%

Tax rate	22.70%	29.90%
Debt/Equity ratio	0.22	0.22
Cost of debt	6.20%	10.00%

After-tax WACC	10.7%	13.2%


Selected WACC	11.9%

TOKYOPLAST.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 TOKYOPLAST.NS:

cost_of_equity (13.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.62) + 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.