WELSPUNIND.NS WACC - Weighted Average Cost of Capital

The WACC of Welspun India Ltd (WELSPUNIND.NS) is 13.1%.

The Cost of Equity of Welspun India Ltd (WELSPUNIND.NS) is 14.50%.

The Cost of Debt of Welspun India Ltd (WELSPUNIND.NS) is 7.10%.

	Range	Selected
Cost of equity	13.00% - 16.00%	14.50%
Tax rate	26.80% - 29.20%	28.00%
Cost of debt	4.80% - 9.40%	7.10%
WACC	11.6% - 14.6%	13.1%

WACC

WELSPUNIND.NS WACC calculation

Category	Low	High

Long-term bond rate	7.2%	7.7%
Equity market risk premium	8.8%	9.8%
Adjusted beta	0.65	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.00%	16.00%

Tax rate	26.80%	29.20%
Debt/Equity ratio	0.17	0.17
Cost of debt	4.80%	9.40%

After-tax WACC	11.6%	14.6%


Selected WACC	13.1%

WELSPUNIND.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 WELSPUNIND.NS:

cost_of_equity (14.50%) = risk_free_rate (7.45%) + equity_risk_premium (9.30%) * adjusted_beta (0.65) + 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.