VISAKAIND.NS WACC - Weighted Average Cost of Capital

The WACC of Visaka Industries Ltd (VISAKAIND.NS) is 16.0%.

The Cost of Equity of Visaka Industries Ltd (VISAKAIND.NS) is 19.20%.

The Cost of Debt of Visaka Industries Ltd (VISAKAIND.NS) is 15.85%.

	Range	Selected
Cost of equity	17.00% - 21.40%	19.20%
Tax rate	26.10% - 26.70%	26.40%
Cost of debt	7.80% - 23.90%	15.85%
WACC	12.3% - 19.8%	16.0%

WACC

VISAKAIND.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.22	1.46

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.00%	21.40%

Tax rate	26.10%	26.70%
Debt/Equity ratio	0.72	0.72
Cost of debt	7.80%	23.90%

After-tax WACC	12.3%	19.8%


Selected WACC	16.0%

VISAKAIND.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 VISAKAIND.NS:

cost_of_equity (19.20%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.22) + 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.