BEC.BK WACC - Weighted Average Cost of Capital

The WACC of BEC World PCL (BEC.BK) is 9.1%.

The Cost of Equity of BEC World PCL (BEC.BK) is 11.45%.

The Cost of Debt of BEC World PCL (BEC.BK) is 5.90%.

	Range	Selected
Cost of equity	9.80% - 13.10%	11.45%
Tax rate	32.90% - 42.60%	37.75%
Cost of debt	4.00% - 7.80%	5.90%
WACC	7.7% - 10.5%	9.1%

WACC

BEC.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.98	1.13

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.80%	13.10%

Tax rate	32.90%	42.60%
Debt/Equity ratio	0.43	0.43
Cost of debt	4.00%	7.80%

After-tax WACC	7.7%	10.5%


Selected WACC	9.1%

BEC.BK'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 BEC.BK:

cost_of_equity (11.45%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.98) + 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.