1109.TW WACC - Weighted Average Cost of Capital

The WACC of Hsing Ta Cement Co Ltd (1109.TW) is 6.5%.

The Cost of Equity of Hsing Ta Cement Co Ltd (1109.TW) is 6.60%.

The Cost of Debt of Hsing Ta Cement Co Ltd (1109.TW) is 4.25%.

	Range	Selected
Cost of equity	5.40% - 7.80%	6.60%
Tax rate	29.90% - 32.60%	31.25%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.3% - 7.8%	6.5%

WACC

1109.TW WACC calculation

Category	Low	High

Long-term bond rate	2.0%	2.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.55	0.69

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.40%	7.80%

Tax rate	29.90%	32.60%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	4.50%

After-tax WACC	5.3%	7.8%


Selected WACC	6.5%

1109.TW'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 1109.TW:

cost_of_equity (6.60%) = risk_free_rate (2.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.55) + 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.