BDL.NS WACC - Weighted Average Cost of Capital

The WACC of Bharat Dynamics Ltd (BDL.NS) is 16.9%.

The Cost of Equity of Bharat Dynamics Ltd (BDL.NS) is 16.90%.

The Cost of Debt of Bharat Dynamics Ltd (BDL.NS) is 19.05%.

	Range	Selected
Cost of equity	15.30% - 18.50%	16.90%
Tax rate	26.40% - 26.70%	26.55%
Cost of debt	7.50% - 30.60%	19.05%
WACC	15.3% - 18.5%	16.9%

WACC

BDL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.01	1.14

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.30%	18.50%

Tax rate	26.40%	26.70%
Debt/Equity ratio	0	0
Cost of debt	7.50%	30.60%

After-tax WACC	15.3%	18.5%


Selected WACC	16.9%

BDL.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 BDL.NS:

cost_of_equity (16.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.01) + 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.