Product details

Product details
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Abstract

This case was written to understand the cost of equity using the capital asset pricing model (CAPM). CAPM is widely used to calculate the cost of equity while calculating the cost of capital of a firm. CAPM is also widely used to calculate the cost of equity for discounting the cash flow of projects and other investments made by companies. The case takes two Sensex heavyweights - one which is aggressive (Jaiprakash Associates) and the other which is passive (Sun pharmaceuticals) - to calculate the cost of equity using CAPM. The case also provides scope for discussion on using different methods of calculating the cost of equity.
Location:
Other setting(s):
2009

About

Abstract

This case was written to understand the cost of equity using the capital asset pricing model (CAPM). CAPM is widely used to calculate the cost of equity while calculating the cost of capital of a firm. CAPM is also widely used to calculate the cost of equity for discounting the cash flow of projects and other investments made by companies. The case takes two Sensex heavyweights - one which is aggressive (Jaiprakash Associates) and the other which is passive (Sun pharmaceuticals) - to calculate the cost of equity using CAPM. The case also provides scope for discussion on using different methods of calculating the cost of equity.

Settings

Location:
Other setting(s):
2009

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