ASAHISONG.NS WACC - Weighted Average Cost of Capital

The WACC of Asahi Songwon Colors Lucky Laminates Ltd (ASAHISONG.NS) is 14.2%.

The Cost of Equity of Asahi Songwon Colors Lucky Laminates Ltd (ASAHISONG.NS) is 17.95%.

The Cost of Debt of Asahi Songwon Colors Lucky Laminates Ltd (ASAHISONG.NS) is 10.35%.

	Range	Selected
Cost of equity	15.50% - 20.40%	17.95%
Tax rate	21.20% - 28.00%	24.60%
Cost of debt	10.20% - 10.50%	10.35%
WACC	12.7% - 15.6%	14.2%

WACC

ASAHISONG.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.04	1.35

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.50%	20.40%

Tax rate	21.20%	28.00%
Debt/Equity ratio	0.6	0.6
Cost of debt	10.20%	10.50%

After-tax WACC	12.7%	15.6%


Selected WACC	14.2%

ASAHISONG.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 ASAHISONG.NS:

cost_of_equity (17.95%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.04) + 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.