UPL.NS WACC - Weighted Average Cost of Capital

The WACC of UPL Ltd (UPL.NS) is 15.4%.

The Cost of Equity of UPL Ltd (UPL.NS) is 18.05%.

The Cost of Debt of UPL Ltd (UPL.NS) is 11.40%.

	Range	Selected
Cost of equity	16.30% - 19.80%	18.05%
Tax rate	10.40% - 12.10%	11.25%
Cost of debt	10.70% - 12.10%	11.40%
WACC	14.1% - 16.8%	15.4%

WACC

UPL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.14	1.28

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.30%	19.80%

Tax rate	10.40%	12.10%
Debt/Equity ratio	0.49	0.49
Cost of debt	10.70%	12.10%

After-tax WACC	14.1%	16.8%


Selected WACC	15.4%

UPL.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 UPL.NS:

cost_of_equity (18.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.14) + 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.