3440.T WACC - Weighted Average Cost of Capital

The WACC of Nisso Pronity Co Ltd (3440.T) is 6.4%.

The Cost of Equity of Nisso Pronity Co Ltd (3440.T) is 10.15%.

The Cost of Debt of Nisso Pronity Co Ltd (3440.T) is 4.25%.

	Range	Selected
Cost of equity	7.60% - 12.70%	10.15%
Tax rate	21.00% - 25.10%	23.05%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.2% - 7.7%	6.4%

WACC

3440.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	1.01	1.45

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.60%	12.70%

Tax rate	21.00%	25.10%
Debt/Equity ratio	1.19	1.19
Cost of debt	4.00%	4.50%

After-tax WACC	5.2%	7.7%


Selected WACC	6.4%

3440.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 3440.T:

cost_of_equity (10.15%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1.01) + 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.