8892.T
Es-con Japan Ltd
Price:  
1,019 
JPY
Volume:  
169,300
Japan | Household Durables

8892.T WACC - Weighted Average Cost of Capital

The WACC of Es-con Japan Ltd (8892.T) is 3.6%.

The Cost of Equity of Es-con Japan Ltd (8892.T) is 6.65%.
The Cost of Debt of Es-con Japan Ltd (8892.T) is 4.25%.

RangeSelected
Cost of equity5.4% - 7.9%6.65%
Tax rate35.8% - 36.9%36.35%
Cost of debt4.0% - 4.5%4.25%
WACC3.2% - 4.0%3.6%
WACC

8892.T WACC calculation

CategoryLowHigh
Long-term bond rate1.4%1.9%
Equity market risk premium6.1%7.1%
Adjusted beta0.650.77
Additional risk adjustments0.0%0.5%
Cost of equity5.4%7.9%
Tax rate35.8%36.9%
Debt/Equity ratio
3.373.37
Cost of debt4.0%4.5%
After-tax WACC3.2%4.0%
Selected WACC3.6%

8892.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 8892.T:

cost_of_equity (6.65%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.65) + 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.