VISAKAIND.NS WACC - Weighted Average Cost of Capital

The WACC of Visaka Industries Ltd (VISAKAIND.NS) is 14.3%.

The Cost of Equity of Visaka Industries Ltd (VISAKAIND.NS) is 20.25%.

The Cost of Debt of Visaka Industries Ltd (VISAKAIND.NS) is 9.60%.

	Range	Selected
Cost of equity	18.10% - 22.40%	20.25%
Tax rate	26.80% - 36.60%	31.70%
Cost of debt	8.70% - 10.50%	9.60%
WACC	13.0% - 15.6%	14.3%

WACC

VISAKAIND.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	1.35	1.56

Additional risk adjustments	0.0%	0.5%
Cost of equity	18.10%	22.40%

Tax rate	26.80%	36.60%
Debt/Equity ratio	0.76	0.76
Cost of debt	8.70%	10.50%

After-tax WACC	13.0%	15.6%


Selected WACC	14.3%

VISAKAIND.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 VISAKAIND.NS:

cost_of_equity (20.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.35) + 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.