500284.BO WACC - Weighted Average Cost of Capital

The WACC of Lords Chloro Alkali Ltd (500284.BO) is 12.8%.

The Cost of Equity of Lords Chloro Alkali Ltd (500284.BO) is 15.55%.

The Cost of Debt of Lords Chloro Alkali Ltd (500284.BO) is 8.30%.

	Range	Selected
Cost of equity	14.30% - 16.80%	15.55%
Tax rate	26.90% - 29.50%	28.20%
Cost of debt	8.10% - 8.50%	8.30%
WACC	11.9% - 13.7%	12.8%

WACC

500284.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.9	0.96

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.30%	16.80%

Tax rate	26.90%	29.50%
Debt/Equity ratio	0.41	0.41
Cost of debt	8.10%	8.50%

After-tax WACC	11.9%	13.7%


Selected WACC	12.8%

500284.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 500284.BO:

cost_of_equity (15.55%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.9) + 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.