WOCKPHARMA.NS WACC - Weighted Average Cost of Capital

The WACC of Wockhardt Ltd (WOCKPHARMA.NS) is 12.7%.

The Cost of Equity of Wockhardt Ltd (WOCKPHARMA.NS) is 13.05%.

The Cost of Debt of Wockhardt Ltd (WOCKPHARMA.NS) is 9.50%.

	Range	Selected
Cost of equity	11.50% - 14.60%	13.05%
Tax rate	14.80% - 22.70%	18.75%
Cost of debt	9.00% - 10.00%	9.50%
WACC	11.2% - 14.1%	12.7%

WACC

WOCKPHARMA.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.56	0.73

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.50%	14.60%

Tax rate	14.80%	22.70%
Debt/Equity ratio	0.08	0.08
Cost of debt	9.00%	10.00%

After-tax WACC	11.2%	14.1%


Selected WACC	12.7%

WOCKPHARMA.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 WOCKPHARMA.NS:

cost_of_equity (13.05%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.56) + 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.