V2RETAIL.NS WACC - Weighted Average Cost of Capital

The WACC of V2 Retail Ltd (V2RETAIL.NS) is 11.3%.

The Cost of Equity of V2 Retail Ltd (V2RETAIL.NS) is 11.80%.

The Cost of Debt of V2 Retail Ltd (V2RETAIL.NS) is 7.85%.

	Range	Selected
Cost of equity	10.40% - 13.20%	11.80%
Tax rate	19.20% - 22.60%	20.90%
Cost of debt	5.70% - 10.00%	7.85%
WACC	9.9% - 12.8%	11.3%

WACC

V2RETAIL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.42	0.57

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.40%	13.20%

Tax rate	19.20%	22.60%
Debt/Equity ratio	0.09	0.09
Cost of debt	5.70%	10.00%

After-tax WACC	9.9%	12.8%


Selected WACC	11.3%

V2RETAIL.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 V2RETAIL.NS:

cost_of_equity (11.80%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.42) + 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.