PNCINFRA.NS WACC - Weighted Average Cost of Capital

The WACC of PNC Infratech Ltd (PNCINFRA.NS) is 12.2%.

The Cost of Equity of PNC Infratech Ltd (PNCINFRA.NS) is 19.65%.

The Cost of Debt of PNC Infratech Ltd (PNCINFRA.NS) is 11.20%.

	Range	Selected
Cost of equity	14.20% - 25.10%	19.65%
Tax rate	29.90% - 31.40%	30.65%
Cost of debt	10.30% - 12.10%	11.20%
WACC	9.8% - 14.5%	12.2%

WACC

PNCINFRA.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.88	1.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.20%	25.10%

Tax rate	29.90%	31.40%
Debt/Equity ratio	1.7	1.7
Cost of debt	10.30%	12.10%

After-tax WACC	9.8%	14.5%


Selected WACC	12.2%

PNCINFRA.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 PNCINFRA.NS:

cost_of_equity (19.65%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.88) + 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.