NDL.NS WACC - Weighted Average Cost of Capital

The WACC of Nandan Denim Ltd (NDL.NS) is 10.6%.

The Cost of Equity of Nandan Denim Ltd (NDL.NS) is 13.15%.

The Cost of Debt of Nandan Denim Ltd (NDL.NS) is 9.45%.

	Range	Selected
Cost of equity	11.50% - 14.80%	13.15%
Tax rate	29.40% - 34.70%	32.05%
Cost of debt	8.90% - 10.00%	9.45%
WACC	9.5% - 11.6%	10.6%

WACC

NDL.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.56	0.74

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.50%	14.80%

Tax rate	29.40%	34.70%
Debt/Equity ratio	0.62	0.62
Cost of debt	8.90%	10.00%

After-tax WACC	9.5%	11.6%


Selected WACC	10.6%

NDL.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 NDL.NS:

cost_of_equity (13.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.56) + 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.