1325.TW WACC - Weighted Average Cost of Capital
The WACC of Universal Inc (1325.TW) is 6.8%.
| Range | Selected | |
| Cost of equity | 5.4% - 8.3% | 6.85% |
| Tax rate | 25.4% - 30.9% | 28.15% |
| Cost of debt | 7.0% - 13.7% | 10.35% |
| WACC | 5.4% - 8.3% | 6.8% |
| Category | Low | High |
| Long-term bond rate | 2.0% | 2.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.48 | 0.68 |
| Additional risk adjustments | 0.5% | 1.0% |
| Cost of equity | 5.4% | 8.3% |
| Tax rate | 25.4% | 30.9% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 7.0% | 13.7% |
| After-tax WACC | 5.4% | 8.3% |
| Selected WACC | 6.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1325.TW | Universal Inc | 0 | 1.35 | 1.35 |
| 1342.TW | Cathay Consolidated Inc | 0.1 | 0.26 | 0.24 |
| 1413.TW | Hung Chou Fiber Ind Co Ltd | 0.54 | 0.27 | 0.2 |
| 1414.TW | Tung Ho Textile Co Ltd | 0.11 | 0.7 | 0.65 |
| 1443.TW | Lily Textile Co Ltd | 1.07 | 0.29 | 0.17 |
| 1446.TW | Hong Ho Precision Textile Co Ltd | 0.06 | 0.75 | 0.72 |
| 1463.TW | Chyang Sheng Dyeing & Finishing Co Ltd | 0 | 0.81 | 0.81 |
| 1465.TW | Wisher Industrial Co Ltd | 0.02 | 0.1 | 0.1 |
| 1468.TW | Chang Ho Fibre Corp | 0.42 | 0.57 | 0.44 |
| 1472.TW | Tri Ocean Textile Co Ltd | 0.1 | -0.15 | -0.14 |
| Low | High | |
| Unlevered beta | 0.22 | 0.52 |
| Relevered beta | 0.22 | 0.52 |
| Adjusted relevered beta | 0.48 | 0.68 |
1325.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 1325.TW:
cost_of_equity (6.85%) = risk_free_rate (2.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.48) + risk_adjustments (0.75%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.