9878.T WACC - Weighted Average Cost of Capital

The WACC of Sekido Co Ltd (9878.T) is 6.3%.

The Cost of Equity of Sekido Co Ltd (9878.T) is 8.30%.

The Cost of Debt of Sekido Co Ltd (9878.T) is 5.50%.

	Range	Selected
Cost of equity	5.90% - 10.70%	8.30%
Tax rate	14.80% - 28.40%	21.60%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.7% - 7.9%	6.3%

WACC

9878.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.74	1.17

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.90%	10.70%

Tax rate	14.80%	28.40%
Debt/Equity ratio	0.98	0.98
Cost of debt	4.00%	7.00%

After-tax WACC	4.7%	7.9%


Selected WACC	6.3%

9878.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 9878.T:

cost_of_equity (8.30%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.74) + 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.