BAJAJHIND.NS WACC - Weighted Average Cost of Capital

The WACC of Bajaj Hindusthan Sugar Ltd (BAJAJHIND.NS) is 14.2%.

The Cost of Equity of Bajaj Hindusthan Sugar Ltd (BAJAJHIND.NS) is 19.65%.

The Cost of Debt of Bajaj Hindusthan Sugar Ltd (BAJAJHIND.NS) is 11.30%.

	Range	Selected
Cost of equity	17.50% - 21.80%	19.65%
Tax rate	2.10% - 4.90%	3.50%
Cost of debt	4.00% - 18.60%	11.30%
WACC	9.1% - 19.3%	14.2%

WACC

BAJAJHIND.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.28	1.49

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.50%	21.80%

Tax rate	2.10%	4.90%
Debt/Equity ratio	1.64	1.64
Cost of debt	4.00%	18.60%

After-tax WACC	9.1%	19.3%


Selected WACC	14.2%

BAJAJHIND.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 BAJAJHIND.NS:

cost_of_equity (19.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.28) + 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.