539686.BO WACC - Weighted Average Cost of Capital

The WACC of KP ENERGY Ltd (539686.BO) is 13.7%.

The Cost of Equity of KP ENERGY Ltd (539686.BO) is 13.90%.

The Cost of Debt of KP ENERGY Ltd (539686.BO) is 11.15%.

	Range	Selected
Cost of equity	12.10% - 15.70%	13.90%
Tax rate	32.60% - 34.60%	33.60%
Cost of debt	7.50% - 14.80%	11.15%
WACC	11.9% - 15.5%	13.7%

WACC

539686.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.64	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.10%	15.70%

Tax rate	32.60%	34.60%
Debt/Equity ratio	0.03	0.03
Cost of debt	7.50%	14.80%

After-tax WACC	11.9%	15.5%


Selected WACC	13.7%

539686.BO'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 539686.BO:

cost_of_equity (13.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.64) + 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.