WEBELSOLAR.NS WACC - Weighted Average Cost of Capital

The WACC of Websol Energy System Ltd (WEBELSOLAR.NS) is 12.3%.

The Cost of Equity of Websol Energy System Ltd (WEBELSOLAR.NS) is 12.50%.

The Cost of Debt of Websol Energy System Ltd (WEBELSOLAR.NS) is 9.40%.

	Range	Selected
Cost of equity	9.90% - 15.10%	12.50%
Tax rate	27.20% - 29.30%	28.25%
Cost of debt	7.80% - 11.00%	9.40%
WACC	9.8% - 14.9%	12.3%

WACC

WEBELSOLAR.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.36	0.78

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.90%	15.10%

Tax rate	27.20%	29.30%
Debt/Equity ratio	0.03	0.03
Cost of debt	7.80%	11.00%

After-tax WACC	9.8%	14.9%


Selected WACC	12.3%

WEBELSOLAR.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 WEBELSOLAR.NS:

cost_of_equity (12.50%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.36) + 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.