The WACC of 4iG Nyrt (4IG.BD) is 10.0%.
| Range | Selected | |
| Cost of equity | 9.80% - 13.70% | 11.75% |
| Tax rate | 17.90% - 20.20% | 19.05% |
| Cost of debt | 4.20% - 18.20% | 11.20% |
| WACC | 5.8% - 14.2% | 10.0% |
| Category | Low | High |
| Long-term bond rate | 6.4% | 6.9% |
| Equity market risk premium | 7.9% | 8.9% |
| Adjusted beta | 0.42 | 0.71 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.80% | 13.70% |
| Tax rate | 17.90% | 20.20% |
| Debt/Equity ratio | 1.7 | 1.7 |
| Cost of debt | 4.20% | 18.20% |
| After-tax WACC | 5.8% | 14.2% |
| Selected WACC | 10.0% | |
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 4IG.BD:
cost_of_equity (11.75%) = risk_free_rate (6.65%) + equity_risk_premium (8.40%) * adjusted_beta (0.42) + 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.