7585.T WACC - Weighted Average Cost of Capital

The WACC of Kan-Nanmaru Corp (7585.T) is 5.9%.

The Cost of Equity of Kan-Nanmaru Corp (7585.T) is 6.20%.

The Cost of Debt of Kan-Nanmaru Corp (7585.T) is 5.50%.

	Range	Selected
Cost of equity	4.70% - 7.70%	6.20%
Tax rate	1.10% - 2.40%	1.75%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.5% - 7.4%	5.9%

WACC

7585.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.37	0.6

Additional risk adjustments	1.0%	1.5%
Cost of equity	4.70%	7.70%

Tax rate	1.10%	2.40%
Debt/Equity ratio	0.44	0.44
Cost of debt	4.00%	7.00%

After-tax WACC	4.5%	7.4%


Selected WACC	5.9%

7585.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 7585.T:

cost_of_equity (6.20%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.37) + 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.