UNICHEMLAB.NS
Unichem Laboratories Ltd
Price:  
598.00 
INR
Volume:  
11,384.00
India | Pharmaceuticals
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UNICHEMLAB.NS WACC - Weighted Average Cost of Capital

The WACC of Unichem Laboratories Ltd (UNICHEMLAB.NS) is 15.1%.

The Cost of Equity of Unichem Laboratories Ltd (UNICHEMLAB.NS) is 16.10%.
The Cost of Debt of Unichem Laboratories Ltd (UNICHEMLAB.NS) is 6.80%.

Range Selected
Cost of equity 14.30% - 17.90% 16.10%
Tax rate 14.50% - 22.20% 18.35%
Cost of debt 6.00% - 7.60% 6.80%
WACC 13.4% - 16.7% 15.1%
WACC

UNICHEMLAB.NS WACC calculation

Category Low High
Long-term bond rate 6.9% 7.4%
Equity market risk premium 8.3% 9.3%
Adjusted beta 0.9 1.07
Additional risk adjustments 0.0% 0.5%
Cost of equity 14.30% 17.90%
Tax rate 14.50% 22.20%
Debt/Equity ratio 0.11 0.11
Cost of debt 6.00% 7.60%
After-tax WACC 13.4% 16.7%
Selected WACC 15.1%

UNICHEMLAB.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 UNICHEMLAB.NS:

cost_of_equity (16.10%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.9) + 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.