3195.T WACC - Weighted Average Cost of Capital

The WACC of Generation Pass Co Ltd (3195.T) is 4.8%.

The Cost of Equity of Generation Pass Co Ltd (3195.T) is 5.40%.

The Cost of Debt of Generation Pass Co Ltd (3195.T) is 4.25%.

	Range	Selected
Cost of equity	4.20% - 6.60%	5.40%
Tax rate	27.70% - 30.60%	29.15%
Cost of debt	4.00% - 4.50%	4.25%
WACC	3.9% - 5.8%	4.8%

WACC

3195.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.46	0.59

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.20%	6.60%

Tax rate	27.70%	30.60%
Debt/Equity ratio	0.31	0.31
Cost of debt	4.00%	4.50%

After-tax WACC	3.9%	5.8%


Selected WACC	4.8%

3195.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 3195.T:

cost_of_equity (5.40%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.46) + 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.