BRSAN.IS WACC - Weighted Average Cost of Capital

The WACC of Borusan Mannesmann Boru Sanayi ve Ticaret AS (BRSAN.IS) is 23.3%.

The Cost of Equity of Borusan Mannesmann Boru Sanayi ve Ticaret AS (BRSAN.IS) is 28.35%.

The Cost of Debt of Borusan Mannesmann Boru Sanayi ve Ticaret AS (BRSAN.IS) is 20.85%.

	Range	Selected
Cost of equity	26.80% - 29.90%	28.35%
Tax rate	16.40% - 22.60%	19.50%
Cost of debt	10.40% - 31.30%	20.85%
WACC	19.0% - 27.5%	23.3%

WACC

BRSAN.IS WACC calculation

Category	Low	High

Long-term bond rate	21.4%	21.9%
Equity market risk premium	10.2%	11.2%
Adjusted beta	0.53	0.68

Additional risk adjustments	0.0%	0.5%
Cost of equity	26.80%	29.90%

Tax rate	16.40%	22.60%
Debt/Equity ratio	0.75	0.75
Cost of debt	10.40%	31.30%

After-tax WACC	19.0%	27.5%


Selected WACC	23.3%

BRSAN.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 BRSAN.IS:

cost_of_equity (28.35%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.53) + 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.