The WACC of Bisalloy Steel Group Ltd (BIS.AX) is 7.8%.
Range | Selected | |
Cost of equity | 6.5% - 9.1% | 7.8% |
Tax rate | 27.7% - 28.2% | 27.95% |
Cost of debt | 4.0% - 7.0% | 5.5% |
WACC | 6.5% - 9.1% | 7.8% |
Category | Low | High |
Long-term bond rate | 4.0% | 4.5% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 0.49 | 0.67 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.5% | 9.1% |
Tax rate | 27.7% | 28.2% |
Debt/Equity ratio | 0.01 | 0.01 |
Cost of debt | 4.0% | 7.0% |
After-tax WACC | 6.5% | 9.1% |
Selected WACC | 7.8% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
BIS.AX | Bisalloy Steel Group Ltd | 0.01 | 1.07 | 1.07 |
192390.KQ | Winhitech Co Ltd | 1.63 | 1.4 | 0.65 |
511672.BO | Scan Steels Ltd | 0.55 | -0.06 | -0.05 |
BAJA.JK | Saranacentral Bajatama Tbk PT | 1.64 | 0.92 | 0.42 |
BSL.AX | BlueScope Steel Ltd | 0.07 | 1.22 | 1.16 |
CHOOBEE.KL | Choo Bee Metal Industries Bhd | 0.11 | 0.84 | 0.78 |
CSP.BK | CSP Steel Center PCL | 5.37 | 0.65 | 0.13 |
DTL.VN | Dai Thien Loc Corp | 1.42 | 0.06 | 0.03 |
LHK.BK | Lohakit Metal PCL | 0.06 | 0.32 | 0.31 |
VISASTEEL.NS | Visa Steel Ltd | 3.22 | -0.83 | -0.25 |
Low | High | |
Unlevered beta | 0.24 | 0.51 |
Relevered beta | 0.24 | 0.51 |
Adjusted relevered beta | 0.49 | 0.67 |
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 BIS.AX:
cost_of_equity (7.80%) = risk_free_rate (4.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.49) + 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.