503092.BO WACC - Weighted Average Cost of Capital

The WACC of Pasupati Spinning and Weaving Mills Ltd (503092.BO) is 10.4%.

The Cost of Equity of Pasupati Spinning and Weaving Mills Ltd (503092.BO) is 12.45%.

The Cost of Debt of Pasupati Spinning and Weaving Mills Ltd (503092.BO) is 11.75%.

	Range	Selected
Cost of equity	11.30% - 13.60%	12.45%
Tax rate	14.30% - 23.50%	18.90%
Cost of debt	8.10% - 15.40%	11.75%
WACC	8.4% - 12.4%	10.4%

WACC

503092.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.53	0.62

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.30%	13.60%

Tax rate	14.30%	23.50%
Debt/Equity ratio	2.05	2.05
Cost of debt	8.10%	15.40%

After-tax WACC	8.4%	12.4%


Selected WACC	10.4%

503092.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 503092.BO:

cost_of_equity (12.45%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.53) + 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.