5989.T WACC - Weighted Average Cost of Capital

The WACC of H-One Co Ltd (5989.T) is 6.7%.

The Cost of Equity of H-One Co Ltd (5989.T) is 13.05%.

The Cost of Debt of H-One Co Ltd (5989.T) is 4.25%.

	Range	Selected
Cost of equity	10.70% - 15.40%	13.05%
Tax rate	11.00% - 18.40%	14.70%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.9% - 7.5%	6.7%

WACC

5989.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	1.53	1.82

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.70%	15.40%

Tax rate	11.00%	18.40%
Debt/Equity ratio	2.05	2.05
Cost of debt	4.00%	4.50%

After-tax WACC	5.9%	7.5%


Selected WACC	6.7%

5989.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 5989.T:

cost_of_equity (13.05%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1.53) + 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.