TOKYOPLAST.NS WACC - Weighted Average Cost of Capital

The WACC of Tokyo Plast International Ltd (TOKYOPLAST.NS) is 10.3%.

The Cost of Equity of Tokyo Plast International Ltd (TOKYOPLAST.NS) is 13.00%.

The Cost of Debt of Tokyo Plast International Ltd (TOKYOPLAST.NS) is 9.35%.

	Range	Selected
Cost of equity	11.50% - 14.50%	13.00%
Tax rate	33.30% - 40.60%	36.95%
Cost of debt	6.60% - 12.10%	9.35%
WACC	8.8% - 11.7%	10.3%

WACC

TOKYOPLAST.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	0.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.50%	14.50%

Tax rate	33.30%	40.60%
Debt/Equity ratio	0.6	0.6
Cost of debt	6.60%	12.10%

After-tax WACC	8.8%	11.7%


Selected WACC	10.3%

TOKYOPLAST.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 TOKYOPLAST.NS:

cost_of_equity (13.00%) = 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.