WEALTH.NS WACC - Weighted Average Cost of Capital
The WACC of Wealth First Portfolio Managers Ltd (WEALTH.NS) is 12.5%.
| Range | Selected | |
| Cost of equity | 11.2% - 13.9% | 12.55% |
| Tax rate | 30.2% - 30.6% | 30.4% |
| Cost of debt | 7.5% - 19.4% | 13.45% |
| WACC | 11.2% - 13.9% | 12.5% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.53 | 0.64 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.2% | 13.9% |
| Tax rate | 30.2% | 30.6% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 7.5% | 19.4% |
| After-tax WACC | 11.2% | 13.9% |
| Selected WACC | 12.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| WEALTH.NS | Wealth First Portfolio Managers Ltd | 0.01 | 0.72 | 0.71 |
| Low | High | |
| Unlevered beta | 0.71 | 0.71 |
| Relevered beta | 0.3 | 0.46 |
| Adjusted relevered beta | 0.53 | 0.64 |
WEALTH.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 WEALTH.NS:
cost_of_equity (12.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.53) + 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.