TRIL.NS WACC - Weighted Average Cost of Capital

The WACC of Transformers and Rectifiers (India) Ltd (TRIL.NS) is 12.8%.

The Cost of Equity of Transformers and Rectifiers (India) Ltd (TRIL.NS) is 12.85%.

The Cost of Debt of Transformers and Rectifiers (India) Ltd (TRIL.NS) is 12.10%.

	Range	Selected
Cost of equity	11.60% - 14.10%	12.85%
Tax rate	26.50% - 31.70%	29.10%
Cost of debt	7.80% - 16.40%	12.10%
WACC	11.5% - 14.1%	12.8%

WACC

TRIL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.57	0.67

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.60%	14.10%

Tax rate	26.50%	31.70%
Debt/Equity ratio	0.02	0.02
Cost of debt	7.80%	16.40%

After-tax WACC	11.5%	14.1%


Selected WACC	12.8%

TRIL.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 TRIL.NS:

cost_of_equity (12.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.57) + 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.