APAX.L WACC - Weighted Average Cost of Capital
The WACC of Apax Global Alpha Ltd (APAX.L) is 10.6%.
| Range | Selected | |
| Cost of equity | 10.5% - 13.4% | 11.95% |
| Tax rate | 0.2% - 0.3% | 0.25% |
| Cost of debt | 9.2% - 9.2% | 9.2% |
| WACC | 9.9% - 11.3% | 10.6% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 1.09 | 1.2 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.5% | 13.4% |
| Tax rate | 0.2% | 0.3% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 9.2% | 9.2% |
| After-tax WACC | 9.9% | 11.3% |
| Selected WACC | 10.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| APAX.L | Apax Global Alpha Ltd | 0.93 | 0.95 | 0.5 |
| ATR.L | Schroder Asian Total Return Investment Company PLC | 0.07 | 0.61 | 0.57 |
| BBGI.L | BBGI SICAV SA | 0 | 0.2 | 0.2 |
| BGS.L | Baillie Gifford Shin Nippon PLC | 0.29 | 0.73 | 0.56 |
| BIOG.L | Biotech Growth Trust PLC | 0.23 | 0.65 | 0.53 |
| BRSC.L | Blackrock Smaller Companies Trust PLC | 0.15 | 1.37 | 1.19 |
| DGN.L | Asia Dragon Trust PLC | 0.11 | 0.63 | 0.57 |
| ICGT.L | ICG Enterprise Trust PLC | 0.03 | 1.12 | 1.09 |
| MRCH.L | Merchants Trust PLC | 0.13 | 1.37 | 1.21 |
| SAIN.L | Scottish American Investment Company P L C | 0.11 | 0.86 | 0.77 |
| USA.L | Baillie Gifford US Growth Trust PLC | 0.06 | 0.57 | 0.54 |
| Low | High | |
| Unlevered beta | 0.56 | 0.57 |
| Relevered beta | 1.13 | 1.3 |
| Adjusted relevered beta | 1.09 | 1.2 |
APAX.L'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 APAX.L:
cost_of_equity (11.95%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.09) + 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.