3646.T WACC - Weighted Average Cost of Capital
The WACC of Ekitan & Co Ltd (3646.T) is 6.1%.
| Range | Selected | |
| Cost of equity | 5.7% - 7.7% | 6.7% |
| Tax rate | 34.7% - 41.1% | 37.9% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 5.3% - 6.9% | 6.1% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.71 | 0.74 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.7% | 7.7% |
| Tax rate | 34.7% | 41.1% |
| Debt/Equity ratio | 0.17 | 0.17 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 5.3% | 6.9% |
| Selected WACC | 6.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 3646.T | Ekitan & Co Ltd | 0.17 | 0.58 | 0.53 |
| 2978.T | Tsukuruba Inc | 0.23 | 0.23 | 0.2 |
| 3645.T | Medical Net Inc | 0.3 | 0.61 | 0.52 |
| 3989.T | Sharingtechnology Inc | 0.02 | 0.87 | 0.86 |
| 4387.T | ZUU Co Ltd | 0.07 | 0.51 | 0.49 |
| 4445.T | Living Technologies Inc | 0.34 | 0.74 | 0.61 |
| 4800.T | Oricon Inc | 0.02 | 0.38 | 0.38 |
| 6048.T | DesignOne Japan Inc | 0.04 | 1.33 | 1.3 |
| 6054.T | Livesense Inc | 0 | 0.63 | 0.63 |
| 7356.T | Retty Inc | 0.23 | 0.58 | 0.51 |
| Low | High | |
| Unlevered beta | 0.51 | 0.56 |
| Relevered beta | 0.57 | 0.61 |
| Adjusted relevered beta | 0.71 | 0.74 |
3646.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 3646.T:
cost_of_equity (6.70%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.71) + 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.