BANVT.IS WACC - Weighted Average Cost of Capital

The WACC of Banvit Bandirma Vitaminli Yem Sanayi AS (BANVT.IS) is 26.9%.

The Cost of Equity of Banvit Bandirma Vitaminli Yem Sanayi AS (BANVT.IS) is 28.40%.

The Cost of Debt of Banvit Bandirma Vitaminli Yem Sanayi AS (BANVT.IS) is 12.40%.

	Range	Selected
Cost of equity	26.60% - 30.20%	28.40%
Tax rate	16.10% - 18.30%	17.20%
Cost of debt	7.00% - 17.80%	12.40%
WACC	24.9% - 29.0%	26.9%

WACC

BANVT.IS WACC calculation

Category	Low	High

Long-term bond rate	21.4%	21.9%
Equity market risk premium	10.2%	11.2%
Adjusted beta	0.51	0.7

Additional risk adjustments	0.0%	0.5%
Cost of equity	26.60%	30.20%

Tax rate	16.10%	18.30%
Debt/Equity ratio	0.09	0.09
Cost of debt	7.00%	17.80%

After-tax WACC	24.9%	29.0%


Selected WACC	26.9%

BANVT.IS'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 BANVT.IS:

cost_of_equity (28.40%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.51) + 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.