7953.T WACC - Weighted Average Cost of Capital
The WACC of Kikusui Chemical Industries Co Ltd (7953.T) is 5.3%.
| Range | Selected | |
| Cost of equity | 5.3% - 7.4% | 6.35% |
| Tax rate | 37.3% - 43.8% | 40.55% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.6% - 6.1% | 5.3% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.64 | 0.71 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.3% | 7.4% |
| Tax rate | 37.3% | 43.8% |
| Debt/Equity ratio | 0.38 | 0.38 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.6% | 6.1% |
| Selected WACC | 5.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 7953.T | Kikusui Chemical Industries Co Ltd | 0.38 | 0.33 | 0.27 |
| 4224.T | Lonseal Corp | 0.06 | 0.37 | 0.35 |
| 5358.T | Isolite Insulating Products Co Ltd | 0.04 | 1.72 | 1.68 |
| 5387.T | Chiyoda Ute Co Ltd | 0.69 | 0.76 | 0.53 |
| 5936.T | Toyo Shutter Co Ltd | 0.89 | 0.76 | 0.49 |
| 5958.T | Sanyo Industries Ltd | 0.05 | 0.41 | 0.4 |
| 6230.T | Sanei Ltd | 0.3 | 0.52 | 0.44 |
| 6484.T | KVK Corp | 0 | 0.2 | 0.2 |
| 7896.T | Seven Industries Co Ltd | 0.8 | 0.26 | 0.17 |
| 7925.T | Maezawa Kasei Industries Co Ltd | 0.01 | 0.76 | 0.76 |
| Low | High | |
| Unlevered beta | 0.38 | 0.46 |
| Relevered beta | 0.46 | 0.57 |
| Adjusted relevered beta | 0.64 | 0.71 |
7953.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 7953.T:
cost_of_equity (6.35%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * 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.