8254.T WACC - Weighted Average Cost of Capital
The WACC of Saikaya Department Store Co Ltd (8254.T) is 5.1%.
| Range | Selected | |
| Cost of equity | 5.7% - 13.5% | 9.6% |
| Tax rate | 2.8% - 5.3% | 4.05% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.2% - 6.0% | 5.1% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.71 | 1.55 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.7% | 13.5% |
| Tax rate | 2.8% | 5.3% |
| Debt/Equity ratio | 4.26 | 4.26 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.2% | 6.0% |
| Selected WACC | 5.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 8254.T | Saikaya Department Store Co Ltd | 4.26 | 0.29 | 0.06 |
| 3086.T | J.Front Retailing Co Ltd | 0.62 | 1.33 | 0.83 |
| 3099.T | Isetan Mitsukoshi Holdings Ltd | 0.15 | 1.69 | 1.48 |
| 3536.T | Axas Holdings Co Ltd | 3.43 | 0.39 | 0.09 |
| 8242.T | H2O Retailing Corp | 0.66 | 1.11 | 0.68 |
| 8247.T | Daiwa Co Ltd | 3.34 | 0.11 | 0.03 |
| 8260.T | Izutsuya Co Ltd | 3.02 | 0.38 | 0.1 |
| 9052.T | Sanyo Electric Railway Co Ltd | 0.87 | 0.28 | 0.15 |
| 9829.T | Nagano Tokyu Department Store Co Ltd | 3.95 | 0.58 | 0.12 |
| V2RETAIL.NS | V2 Retail Ltd | 0.08 | 0.72 | 0.66 |
| Low | High | |
| Unlevered beta | 0.11 | 0.36 |
| Relevered beta | 0.57 | 1.82 |
| Adjusted relevered beta | 0.71 | 1.55 |
8254.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 8254.T:
cost_of_equity (9.60%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.71) + 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.