500166.BO WACC - Weighted Average Cost of Capital

The WACC of Goodricke Group Ltd (500166.BO) is 13.1%.

The Cost of Equity of Goodricke Group Ltd (500166.BO) is 14.50%.

The Cost of Debt of Goodricke Group Ltd (500166.BO) is 10.00%.

	Range	Selected
Cost of equity	13.20% - 15.80%	14.50%
Tax rate	35.70% - 42.60%	39.15%
Cost of debt	9.50% - 10.50%	10.00%
WACC	12.0% - 14.2%	13.1%

WACC

500166.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.77	0.86

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.20%	15.80%

Tax rate	35.70%	42.60%
Debt/Equity ratio	0.2	0.2
Cost of debt	9.50%	10.50%

After-tax WACC	12.0%	14.2%


Selected WACC	13.1%

500166.BO'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 500166.BO:

cost_of_equity (14.50%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.77) + 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.