AIN.WA WACC - Weighted Average Cost of Capital

The WACC of ABS Investment SA (AIN.WA) is 7.5%.

The Cost of Equity of ABS Investment SA (AIN.WA) is 10.85%.

The Cost of Debt of ABS Investment SA (AIN.WA) is 5.00%.

	Range	Selected
Cost of equity	9.00% - 12.70%	10.85%
Tax rate	15.50% - 17.20%	16.35%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.6% - 8.4%	7.5%

WACC

AIN.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.56	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.00%	12.70%

Tax rate	15.50%	17.20%
Debt/Equity ratio	1	1
Cost of debt	5.00%	5.00%

After-tax WACC	6.6%	8.4%


Selected WACC	7.5%

AIN.WA'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 AIN.WA:

cost_of_equity (10.85%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.56) + 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.