SIMBHALS.NS WACC - Weighted Average Cost of Capital

The WACC of Simbhaoli Sugars Ltd (SIMBHALS.NS) is 7.0%.

The Cost of Equity of Simbhaoli Sugars Ltd (SIMBHALS.NS) is 38.15%.

The Cost of Debt of Simbhaoli Sugars Ltd (SIMBHALS.NS) is 5.95%.

	Range	Selected
Cost of equity	30.10% - 46.20%	38.15%
Tax rate	0.50% - 0.80%	0.65%
Cost of debt	4.00% - 7.90%	5.95%
WACC	4.9% - 9.2%	7.0%

WACC

SIMBHALS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	2.79	4.12

Additional risk adjustments	0.0%	0.5%
Cost of equity	30.10%	46.20%

Tax rate	0.50%	0.80%
Debt/Equity ratio	27.76	27.76
Cost of debt	4.00%	7.90%

After-tax WACC	4.9%	9.2%


Selected WACC	7.0%

SIMBHALS.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 SIMBHALS.NS:

cost_of_equity (38.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (2.79) + 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.