UTTAMSTL.NS WACC - Weighted Average Cost of Capital

The WACC of Uttam Galva Steels Ltd (UTTAMSTL.NS) is 6.1%.

The Cost of Equity of Uttam Galva Steels Ltd (UTTAMSTL.NS) is 102.15%.

The Cost of Debt of Uttam Galva Steels Ltd (UTTAMSTL.NS) is 5.50%.

	Range	Selected
Cost of equity	22.10% - 182.20%	102.15%
Tax rate	0.20% - 1.10%	0.65%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.1% - 8.0%	6.1%

WACC

UTTAMSTL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.83	18.72

Additional risk adjustments	0.0%	0.5%
Cost of equity	22.10%	182.20%

Tax rate	0.20%	1.10%
Debt/Equity ratio	157.52	157.52
Cost of debt	4.00%	7.00%

After-tax WACC	4.1%	8.0%


Selected WACC	6.1%

UTTAMSTL.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 UTTAMSTL.NS:

cost_of_equity (102.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.83) + 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.