4534.T WACC - Weighted Average Cost of Capital
The WACC of Mochida Pharmaceutical Co Ltd (4534.T) is 6.0%.
| Range | Selected | |
| Cost of equity | 5.2% - 6.8% | 6% |
| Tax rate | 27.1% - 27.7% | 27.4% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 5.1% - 6.8% | 6.0% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.61 | 0.63 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.2% | 6.8% |
| Tax rate | 27.1% | 27.7% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 5.1% | 6.8% |
| Selected WACC | 6.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 4534.T | Mochida Pharmaceutical Co Ltd | 1.1 | 0.67 | 0.37 |
| 4521.T | Kaken Pharmaceutical Co Ltd | 0.02 | 0.27 | 0.27 |
| 4538.T | Fuso Pharmaceutical Industries Ltd | 1.05 | 0.76 | 0.43 |
| 4540.T | Tsumura & Co | 0.27 | 0.55 | 0.46 |
| 4547.T | Kissei Pharmaceutical Co Ltd | 0.01 | 0.43 | 0.43 |
| 4551.T | Torii Pharmaceutical Co Ltd | 0 | 0.81 | 0.81 |
| 4553.T | Towa Pharmaceutical Co Ltd | 1.47 | 0.85 | 0.41 |
| 4559.T | Zeria Pharmaceutical Co Ltd | 0.36 | 0.42 | 0.33 |
| 4569.T | Kyorin Holdings Inc | 0.29 | 0.55 | 0.45 |
| 4577.T | Daito Pharmaceutical Co Ltd | 0.27 | 0.36 | 0.3 |
| Low | High | |
| Unlevered beta | 0.4 | 0.43 |
| Relevered beta | 0.42 | 0.45 |
| Adjusted relevered beta | 0.61 | 0.63 |
4534.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 4534.T:
cost_of_equity (6.00%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.61) + 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.