6770.T WACC - Weighted Average Cost of Capital
The WACC of Alps Alpine Co Ltd (6770.T) is 8.7%.
| Range | Selected | |
| Cost of equity | 8.6% - 12.6% | 10.6% |
| Tax rate | 27.7% - 30.6% | 29.15% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 7.2% - 10.2% | 8.7% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.17 | 1.43 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.6% | 12.6% |
| Tax rate | 27.7% | 30.6% |
| Debt/Equity ratio | 0.33 | 0.33 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 7.2% | 10.2% |
| Selected WACC | 8.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 6770.T | Alps Alpine Co Ltd | 0.33 | 0.9 | 0.73 |
| 4062.T | Ibiden Co Ltd | 0.41 | 1.69 | 1.32 |
| 4980.T | Dexerials Corp | 0.06 | 1.45 | 1.39 |
| 5214.T | Nippon Electric Glass Co Ltd | 0.37 | 0.59 | 0.47 |
| 5344.T | Maruwa Co Ltd | 1.01 | 1.42 | 0.84 |
| 6640.T | I-PEX Inc | 0.32 | 1.71 | 1.4 |
| 6645.T | Omron Corp | 0.18 | 0.84 | 0.75 |
| 6740.T | Japan Display Inc | 0.96 | 1.48 | 0.89 |
| 6787.T | Meiko Electronics Co Ltd | 0.56 | 1.91 | 1.37 |
| 6976.T | Taiyo Yuden Co Ltd | 0.52 | 1.52 | 1.12 |
| Low | High | |
| Unlevered beta | 0.87 | 1.2 |
| Relevered beta | 1.25 | 1.64 |
| Adjusted relevered beta | 1.17 | 1.43 |
6770.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 6770.T:
cost_of_equity (10.60%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1.17) + 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.