Fairfax India Holdings Corp (FIH.U.TO) WACC Analysis

As of June 6, 2025, Fairfax India Holdings Corp (FIH.U.TO) carries a Weighted Average Cost of Capital (WACC) of 6.2%. WACC reflects the blended rate Fairfax India Holdings Corp must pay to both equity and debt holders.

Within that, the cost of equity is 5.6%, the cost of debt is 4.0%, and the effective tax rate is 7.0%.

Breakdown of WACC Components

• Long-term bond rate: 3.2% – 3.7%
• Equity market risk premium: 4.6% – 5.6%
• Adjusted beta: 0.54 – 0.68
• Additional risk adjustment: 0.0% – 0.5%
• Debt-to-equity ratio: 0.28

What It Means for Investors

With a selected WACC of 6.2%, Fairfax India Holdings Corp must ensure any new investment returns exceed this threshold to generate shareholder value. This level reflects an attractive low cost of capital.