4461.T WACC - Weighted Average Cost of Capital
The WACC of DKS Co Ltd (4461.T) is 5.6%.
| Range | Selected | |
| Cost of equity | 6.4% - 11.5% | 8.95% |
| Tax rate | 28.8% - 30.0% | 29.4% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.4% - 6.8% | 5.6% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.81 | 1.27 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.4% | 11.5% |
| Tax rate | 28.8% | 30.0% |
| Debt/Equity ratio | 1.27 | 1.27 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.4% | 6.8% |
| Selected WACC | 5.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 4461.T | DKS Co Ltd | 1.27 | 1.5 | 0.79 |
| 4005.T | Sumitomo Chemical Co Ltd | 2.64 | 0.71 | 0.25 |
| 4078.T | Sakai Chemical Industry Co Ltd | 0.62 | 1.04 | 0.73 |
| 4099.T | Shikoku Chemicals Corp | 0.37 | 1.25 | 0.99 |
| 4109.T | Stella Chemifa Corp | 0.11 | 0.84 | 0.78 |
| 4188.T | Mitsubishi Chemical Holdings Corp | 2.03 | 0.73 | 0.3 |
| 4410.T | Harima Chemicals Group Inc | 1.91 | 0.67 | 0.29 |
| 4635.T | Tokyo Printing Ink Mfg Co Ltd | 0.71 | 0.64 | 0.43 |
| 4960.T | Chemipro Kasei Kaisha Ltd | 1.33 | 0.36 | 0.19 |
| 5013.T | Yushiro Chemical Industry Co Ltd | 0.25 | 0.9 | 0.77 |
| Low | High | |
| Unlevered beta | 0.38 | 0.74 |
| Relevered beta | 0.72 | 1.4 |
| Adjusted relevered beta | 0.81 | 1.27 |
4461.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 4461.T:
cost_of_equity (8.95%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.81) + 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.