4539.T WACC - Weighted Average Cost of Capital
The WACC of Nippon Chemiphar Co Ltd (4539.T) is 4.3%.
| Range | Selected | |
| Cost of equity | 6.3% - 9.3% | 7.8% |
| Tax rate | 28.9% - 29.9% | 29.4% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 3.8% - 4.9% | 4.3% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.79 | 0.97 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.3% | 9.3% |
| Tax rate | 28.9% | 29.9% |
| Debt/Equity ratio | 2.61 | 2.61 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 3.8% | 4.9% |
| Selected WACC | 4.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 4539.T | Nippon Chemiphar Co Ltd | 2.61 | 0.2 | 0.07 |
| 4512.T | Wakamoto Pharmaceutical Co Ltd | 0.01 | 0.38 | 0.38 |
| 4521.T | Kaken Pharmaceutical Co Ltd | 0.02 | 0.28 | 0.28 |
| 4530.T | Hisamitsu Pharmaceutical Co Inc | 0.01 | 0.2 | 0.2 |
| 4538.T | Fuso Pharmaceutical Industries Ltd | 0.58 | 0.78 | 0.55 |
| 4541.T | Nichi-Iko Pharmaceutical Co Ltd | 6.6 | 0.32 | 0.06 |
| 4548.T | Seikagaku Corp | 0.01 | 0.87 | 0.86 |
| 4554.T | Fuji Pharma Co Ltd | 0.9 | 0.88 | 0.54 |
| 4577.T | Daito Pharmaceutical Co Ltd | 0.27 | 0.36 | 0.3 |
| 4581.T | Taisho Pharmaceutical Holdings Co Ltd | 0 | -0.18 | -0.18 |
| Low | High | |
| Unlevered beta | 0.24 | 0.33 |
| Relevered beta | 0.69 | 0.96 |
| Adjusted relevered beta | 0.79 | 0.97 |
4539.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 4539.T:
cost_of_equity (7.80%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.79) + 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.