As of today (2026-06-27), Swan Defence and Heavy Industries's weighted average cost of capital is 9.13%%. Swan Defence and Heavy Industries's ROIC % is -13.20% (calculated using TTM income statement data).
Swan Defence and Heavy Industries earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
Swan Defence and Heavy Industries (NSE:SWANDEF) WACC % Explanation
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Swan Defence and Heavy Industries's weighted average cost of capital is 9.13%%. Swan Defence and Heavy Industries's ROIC % is -13.20% (calculated using TTM income statement data).
Swan Defence and Heavy Industries earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
Related Terms
Swan Defence and Heavy Industries WACC % Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Aerospace & Defense subindustry, Swan Defence and Heavy Industries's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Swan Defence and Heavy Industries WACC % vs Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, Swan Defence and Heavy Industries's WACC % distribution charts can be found below:
* The bar in red indicates where Swan Defence and Heavy Industries's WACC % falls into.
Swan Defence and Heavy Industries WACC % Calculation
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, Swan Defence and Heavy Industries's market capitalization (E) is ₹116722.572 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Mar. 2026, Swan Defence and Heavy Industries's latest one-year quarterly average Book Value of Debt (D) is ₹26357.6097 Mil.
a) weight of equity = E / (E + D) = 116722.572 / (116722.572 + 26357.6097) = 0.8158
b) weight of debt = D / (E + D) = 26357.6097 / (116722.572 + 26357.6097) = 0.1842
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 7.02%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. Swan Defence and Heavy Industries's beta is 0.6778.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 7.02% + 0.6778 * 6% = 11.0868%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
As of Mar. 2026, Swan Defence and Heavy Industries's interest expense (positive number) was ₹123.17 Mil. Its total Book Value of Debt (D) is ₹26357.6097 Mil.
Cost of Debt = 123.17 / 26357.6097 = 0.4673%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = 0 / -2262.877 = 0%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Swan Defence and Heavy Industries (NSE:SWANDEF) has a WACC % of 9.13% as of Jun. 27, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Swan Defence and Heavy Industries and its competitors. This is 15% below median its historical median of 10.73. Over the past decade, Swan Defence and Heavy Industries' WACC % has ranged from 2.35 to 27.74. According to the industry distribution chart, Swan Defence and Heavy Industries ranks #144 out of 358 companies in the Aerospace & Defense industry, placing it in the top 40.2%.
Is Swan Defence and Heavy Industries' WACC % too high?
Swan Defence and Heavy Industries' current WACC % of 9.13% is 15% below median its 10-year median of 10.73. Over the past 10 years, this metric has ranged from a low of 2.35 to a high of 27.74. The Aerospace & Defense industry median WACC % is 9.82. Swan Defence and Heavy Industries' value of 9.13% is 7% below this industry median. Based on the distribution chart, Swan Defence and Heavy Industries ranks #144 out of 358 companies in the Aerospace & Defense industry, which is above the industry midpoint. Overall, Swan Defence and Heavy Industries has a GF Score™ of 31/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Swan Defence and Heavy Industries' WACC % compare to GE and RTX?
According to the Aerospace & Defense industry distribution chart, Swan Defence and Heavy Industries ranks #144 out of 358 companies for WACC %. This puts Swan Defence and Heavy Industries in the upper half of its industry. The industry median WACC % is 9.82. Swan Defence and Heavy Industries' value of 9.13% is 7% below this benchmark. Historically, Swan Defence and Heavy Industries' own WACC % has ranged from 2.35 to 27.74 over the past decade. While the company's 10-year median is 10.73 vs. the industry median of 9.82, Swan Defence and Heavy Industries has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for an Aerospace & Defense company?
The median WACC % among Aerospace & Defense companies is 9.82, based on 358 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Swan Defence and Heavy Industries's current WACC % of 9.13% is 7% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Swan Defence and Heavy Industries and its competitors. For the Aerospace & Defense industry, the median WACC % is 9.82 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Swan Defence and Heavy Industries's current WACC % is 9.13%, which is 15% below median its own 10-year median of 10.73. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Swan Defence and Heavy Industries stock overvalued right now?
Based on GuruFocus' analysis, Swan Defence and Heavy Industries (NSE:SWANDEF) is currently considered Possible Value Trap. The stock's GF Value™ is ₹11,933.34, compared to a current price of ₹2,215.60 — trading 81.4% below its estimated fair value. The current WACC % is 9.13%, which is 15% below median its 10-year median of 10.73 and 7% below the Aerospace & Defense industry median of 9.82. Swan Defence and Heavy Industries' overall GF Score™ is 31/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For Swan Defence and Heavy Industries (NSE:SWANDEF), the current WACC % is 9.13% as of Jun. 27, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Swan Defence and Heavy Industries (NSE:SWANDEF) Overvalued in 2026?
Based on GuruFocus' analysis, Swan Defence and Heavy Industries stock appears to be undervalued.
The current stock price of ₹2,215.60 is trading 81.4% below its estimated GF Value™ of ₹11,933.34.
GuruFocus considers Swan Defence and Heavy Industries to be Possible Value Trap.
Key valuation signals for NSE:SWANDEF:
WACC %: 9.13% (15% below median its 10-year median of 10.73)
GF Value™: ₹11,933.34 vs. price of ₹2,215.60 (81.4% below fair value)
Industry Position: 7% below the Aerospace & Defense median (#144 of 358)
No single metric tells the full story. See the NSE:SWANDEF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Swan Defence and Heavy Industries Business Description
Swan Defence and Heavy Industries Ltd is mainly engaged in the construction of vessels, repairs, and refits of ships and rigs, and heavy engineering. The company has developed an integrated shipbuilding, ship and rig repair and conversion, ship production, offshore construction, and heavy engineering facility in Gujarat. The company has a large shipbuilding/repair infrastructure in India including the Dry Dock.
31GF Score
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