The WACC of APS Energia SA (APE.WA) is 8.4%.
Range | Selected | |
Cost of equity | 7.9% - 9.9% | 8.9% |
Tax rate | 4.7% - 8.7% | 6.7% |
Cost of debt | 7.0% - 7.5% | 7.25% |
WACC | 7.6% - 9.3% | 8.4% |
Category | Low | High |
Long-term bond rate | 5.5% | 6.0% |
Equity market risk premium | 6.3% | 7.3% |
Adjusted beta | 0.37 | 0.46 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.9% | 9.9% |
Tax rate | 4.7% | 8.7% |
Debt/Equity ratio | 0.27 | 0.27 |
Cost of debt | 7.0% | 7.5% |
After-tax WACC | 7.6% | 9.3% |
Selected WACC | 8.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
APE.WA | APS Energia SA | 0.27 | 0.17 | 0.14 |
ALDBT.PA | DBT SA | 8.44 | 0.26 | 0.03 |
ALMEC.PA | Mecelec Composites SA | 0.86 | 0.75 | 0.41 |
GEREL.IS | Gersan Elektrik Ticaret ve Sanayi AS | 0.39 | 1.85 | 1.35 |
HELIO.ST | Heliospectra AB (publ) | 0.22 | -0.35 | -0.29 |
LECN.SW | Leclanche SA | 0.44 | -1.91 | -1.35 |
LEN.WA | Lena Lighting SA | 0.27 | 0.23 | 0.18 |
LPA.L | LPA Group PLC | 0.43 | -0.67 | -0.48 |
RDL.WA | Radpol SA | 0.27 | 0.57 | 0.46 |
RLP.WA | Relpol SA | 0.46 | 0.1 | 0.07 |
Low | High | |
Unlevered beta | 0.05 | 0.16 |
Relevered beta | 0.06 | 0.19 |
Adjusted relevered beta | 0.37 | 0.46 |
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 APE.WA:
cost_of_equity (8.90%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.37) + 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.