APE.WA WACC - Weighted Average Cost of Capital

The WACC of APS Energia SA (APE.WA) is 8.5%.

The Cost of Equity of APS Energia SA (APE.WA) is 8.95%.

The Cost of Debt of APS Energia SA (APE.WA) is 7.25%.

	Range	Selected
Cost of equity	7.90% - 10.00%	8.95%
Tax rate	4.70% - 8.70%	6.70%
Cost of debt	7.00% - 7.50%	7.25%
WACC	7.6% - 9.3%	8.5%

WACC

APE.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.37	0.47

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.90%	10.00%

Tax rate	4.70%	8.70%
Debt/Equity ratio	0.26	0.26
Cost of debt	7.00%	7.50%

After-tax WACC	7.6%	9.3%


Selected WACC	8.5%

APE.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 APE.WA:

cost_of_equity (8.95%) = 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.