VIDHIING.NS WACC - Weighted Average Cost of Capital

The WACC of Vidhi Specialty Food Ingredients Ltd (VIDHIING.NS) is 13.4%.

The Cost of Equity of Vidhi Specialty Food Ingredients Ltd (VIDHIING.NS) is 13.65%.

The Cost of Debt of Vidhi Specialty Food Ingredients Ltd (VIDHIING.NS) is 7.35%.

	Range	Selected
Cost of equity	12.10% - 15.20%	13.65%
Tax rate	25.50% - 25.70%	25.60%
Cost of debt	7.20% - 7.50%	7.35%
WACC	11.9% - 14.9%	13.4%

WACC

VIDHIING.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.63	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.10%	15.20%

Tax rate	25.50%	25.70%
Debt/Equity ratio	0.04	0.04
Cost of debt	7.20%	7.50%

After-tax WACC	11.9%	14.9%


Selected WACC	13.4%

VIDHIING.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 VIDHIING.NS:

cost_of_equity (13.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.63) + 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.