VETO.NS WACC - Weighted Average Cost of Capital

The WACC of VETO Switch Gears And Cables Ltd (VETO.NS) is 15.5%.

The Cost of Equity of VETO Switch Gears And Cables Ltd (VETO.NS) is 16.45%.

The Cost of Debt of VETO Switch Gears And Cables Ltd (VETO.NS) is 7.20%.

	Range	Selected
Cost of equity	14.70% - 18.20%	16.45%
Tax rate	31.60% - 32.40%	32.00%
Cost of debt	6.90% - 7.50%	7.20%
WACC	13.8% - 17.1%	15.5%

WACC

VETO.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.94	1.11

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.70%	18.20%

Tax rate	31.60%	32.40%
Debt/Equity ratio	0.09	0.09
Cost of debt	6.90%	7.50%

After-tax WACC	13.8%	17.1%


Selected WACC	15.5%

VETO.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 VETO.NS:

cost_of_equity (16.45%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.94) + 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.