5202.T WACC - Weighted Average Cost of Capital

The WACC of Nippon Sheet Glass Co Ltd (5202.T) is 7.3%.

The Cost of Equity of Nippon Sheet Glass Co Ltd (5202.T) is 13.25%.

The Cost of Debt of Nippon Sheet Glass Co Ltd (5202.T) is 11.55%.

	Range	Selected
Cost of equity	9.60% - 16.90%	13.25%
Tax rate	40.00% - 42.10%	41.05%
Cost of debt	4.70% - 18.40%	11.55%
WACC	3.4% - 11.2%	7.3%

WACC

5202.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	1.33	2.03

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.60%	16.90%

Tax rate	40.00%	42.10%
Debt/Equity ratio	9.81	9.81
Cost of debt	4.70%	18.40%

After-tax WACC	3.4%	11.2%


Selected WACC	7.3%

5202.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 5202.T:

cost_of_equity (13.25%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1.33) + 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.