531109.BO WACC - Weighted Average Cost of Capital

The WACC of Ishan Dyes and Chemicals Ltd (531109.BO) is 13.1%.

The Cost of Equity of Ishan Dyes and Chemicals Ltd (531109.BO) is 13.30%.

The Cost of Debt of Ishan Dyes and Chemicals Ltd (531109.BO) is 19.45%.

	Range	Selected
Cost of equity	12.00% - 14.60%	13.30%
Tax rate	26.20% - 35.40%	30.80%
Cost of debt	7.00% - 31.90%	19.45%
WACC	9.6% - 16.7%	13.1%

WACC

531109.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.61	0.73

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.00%	14.60%

Tax rate	26.20%	35.40%
Debt/Equity ratio	0.55	0.55
Cost of debt	7.00%	31.90%

After-tax WACC	9.6%	16.7%


Selected WACC	13.1%

531109.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 531109.BO:

cost_of_equity (13.30%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.61) + 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.