anonymous
  • anonymous
Hello, I need some help in estimating WACC of a firm which has its manufacturing base in India but has say all its sales to the US. In such a case, should one take a US WACC for the firm or India WACC. If I take the US WACC, should I need to adjust for country risk (currency risk etc). Appreciate your help on this. Many many thanks.
Finance
jamiebookeater
  • jamiebookeater
I got my questions answered at brainly.com in under 10 minutes. Go to brainly.com now for free help!
At vero eos et accusamus et iusto odio dignissimos ducimus qui blanditiis praesentium voluptatum deleniti atque corrupti quos dolores et quas molestias excepturi sint occaecati cupiditate non provident, similique sunt in culpa qui officia deserunt mollitia animi, id est laborum et dolorum fuga. Et harum quidem rerum facilis est et expedita distinctio. Nam libero tempore, cum soluta nobis est eligendi optio cumque nihil impedit quo minus id quod maxime placeat facere possimus, omnis voluptas assumenda est, omnis dolor repellendus. Itaque earum rerum hic tenetur a sapiente delectus, ut aut reiciendis voluptatibus maiores alias consequatur aut perferendis doloribus asperiores repellat.

Get this expert

answer on brainly

SEE EXPERT ANSWER

Get your free account and access expert answers to this
and thousands of other questions

anonymous
  • anonymous
I'd say calculate the cost of equity using US values and adjust it for country risk in India.
anonymous
  • anonymous
Thanks BruLee
anonymous
  • anonymous
We always would look at the country where it is being manufactured. In today's time where the US govt. is more likely to default compared to indian goverment I would prefer to take Indian 10 year bond rates as risk free return.

Looking for something else?

Not the answer you are looking for? Search for more explanations.