TEXMOPIPES.NS WACC - Weighted Average Cost of Capital

The WACC of Texmo Pipes and Products Ltd (TEXMOPIPES.NS) is 13.6%.

The Cost of Equity of Texmo Pipes and Products Ltd (TEXMOPIPES.NS) is 14.40%.

The Cost of Debt of Texmo Pipes and Products Ltd (TEXMOPIPES.NS) is 15.65%.

	Range	Selected
Cost of equity	13.10% - 15.70%	14.40%
Tax rate	16.50% - 24.10%	20.30%
Cost of debt	7.90% - 23.40%	15.65%
WACC	10.7% - 16.5%	13.6%

WACC

TEXMOPIPES.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.75	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.10%	15.70%

Tax rate	16.50%	24.10%
Debt/Equity ratio	0.61	0.61
Cost of debt	7.90%	23.40%

After-tax WACC	10.7%	16.5%


Selected WACC	13.6%

TEXMOPIPES.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 TEXMOPIPES.NS:

cost_of_equity (14.40%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.75) + 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.