2349.T WACC - Weighted Average Cost of Capital

The WACC of Nippon Information Development Co Ltd (2349.T) is 8.2%.

The Cost of Equity of Nippon Information Development Co Ltd (2349.T) is 8.20%.

The Cost of Debt of Nippon Information Development Co Ltd (2349.T) is 4.55%.

	Range	Selected
Cost of equity	6.50% - 9.90%	8.20%
Tax rate	31.70% - 32.50%	32.10%
Cost of debt	4.00% - 5.10%	4.55%
WACC	6.4% - 9.9%	8.2%

WACC

2349.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.83	1.05

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.50%	9.90%

Tax rate	31.70%	32.50%
Debt/Equity ratio	0	0
Cost of debt	4.00%	5.10%

After-tax WACC	6.4%	9.9%


Selected WACC	8.2%

2349.T'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 2349.T:

cost_of_equity (8.20%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.83) + 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.