6625.T WACC - Weighted Average Cost of Capital

The WACC of Jalco Holdings Inc (6625.T) is 5.3%.

The Cost of Equity of Jalco Holdings Inc (6625.T) is 5.85%.

The Cost of Debt of Jalco Holdings Inc (6625.T) is 6.95%.

	Range	Selected
Cost of equity	4.60% - 7.10%	5.85%
Tax rate	28.70% - 29.80%	29.25%
Cost of debt	4.00% - 9.90%	6.95%
WACC	3.6% - 7.0%	5.3%

WACC

6625.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.35	0.52

Additional risk adjustments	1.0%	1.5%
Cost of equity	4.60%	7.10%

Tax rate	28.70%	29.80%
Debt/Equity ratio	1.4	1.4
Cost of debt	4.00%	9.90%

After-tax WACC	3.6%	7.0%


Selected WACC	5.3%

6625.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 6625.T:

cost_of_equity (5.85%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.35) + risk_adjustments (1.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.