The WACC of Banpu PCL (BANPU.BK) is 9.6%.
Range | Selected | |
Cost of equity | 16.9% - 30.6% | 23.75% |
Tax rate | 26.9% - 35.8% | 31.35% |
Cost of debt | 4.9% - 14.3% | 9.6% |
WACC | 6.0% - 13.1% | 9.6% |
Category | Low | High |
Long-term bond rate | 2.6% | 3.1% |
Equity market risk premium | 7.4% | 8.4% |
Adjusted beta | 1.93 | 3.21 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 16.9% | 30.6% |
Tax rate | 26.9% | 35.8% |
Debt/Equity ratio | 4.5 | 4.5 |
Cost of debt | 4.9% | 14.3% |
After-tax WACC | 6.0% | 13.1% |
Selected WACC | 9.6% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
BANPU.BK | Banpu PCL | 4.5 | 1.49 | 0.35 |
600188.SS | Yanzhou Coal Mining Co Ltd | 0.97 | 1.05 | 0.62 |
600508.SS | Shanghai Datun Energy Resources Co Ltd | 0.25 | 1.32 | 1.12 |
600971.SS | Anhui Hengyuan Coal Industry and Electricity Power Co Ltd | 0.26 | 1.32 | 1.11 |
601088.SS | China Shenhua Energy Co Ltd | 0.05 | 0.51 | 0.49 |
601699.SS | Shanxi LuAn Environmental Energy Dev Co Ltd | 0.07 | 1.25 | 1.2 |
601898.SS | China Coal Energy Co Ltd | 0.68 | 0.54 | 0.36 |
COALINDIA.NS | Coal India Ltd | 0.03 | 1.04 | 1.02 |
LANNA.BK | Lanna Resources PCL | 0.19 | 0.45 | 0.39 |
WHC.AX | Whitehaven Coal Ltd | 0.37 | 1.29 | 1.02 |
Low | High | |
Unlevered beta | 0.57 | 1.02 |
Relevered beta | 2.39 | 4.3 |
Adjusted relevered beta | 1.93 | 3.21 |
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 BANPU.BK:
cost_of_equity (23.75%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (1.93) + 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.