4577.T WACC - Weighted Average Cost of Capital
The WACC of Daito Pharmaceutical Co Ltd (4577.T) is 5.8%.
| Range | Selected | |
| Cost of equity | 5.4% - 7.7% | 6.55% |
| Tax rate | 29.6% - 30.1% | 29.85% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.8% - 6.7% | 5.8% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.66 | 0.75 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.4% | 7.7% |
| Tax rate | 29.6% | 30.1% |
| Debt/Equity ratio | 0.29 | 0.29 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.8% | 6.7% |
| Selected WACC | 5.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 4577.T | Daito Pharmaceutical Co Ltd | 0.29 | 0.31 | 0.26 |
| 4517.T | Biofermin Pharmaceutical Co Ltd | 0 | 0.39 | 0.39 |
| 4538.T | Fuso Pharmaceutical Industries Ltd | 1.08 | 0.73 | 0.42 |
| 4539.T | Nippon Chemiphar Co Ltd | 2.83 | 0.21 | 0.07 |
| 4547.T | Kissei Pharmaceutical Co Ltd | 0.01 | 0.5 | 0.5 |
| 4548.T | Seikagaku Corp | 0.01 | 0.88 | 0.88 |
| 4551.T | Torii Pharmaceutical Co Ltd | 0 | 0.82 | 0.81 |
| 4554.T | Fuji Pharma Co Ltd | 0.89 | 0.89 | 0.55 |
| 4559.T | Zeria Pharmaceutical Co Ltd | 0.38 | 0.46 | 0.36 |
| 4574.T | Taiko Pharmaceutical Co Ltd | 0.14 | 0.72 | 0.66 |
| Low | High | |
| Unlevered beta | 0.41 | 0.52 |
| Relevered beta | 0.49 | 0.63 |
| Adjusted relevered beta | 0.66 | 0.75 |
4577.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 4577.T:
cost_of_equity (6.55%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.66) + 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.