The WACC of Bank Sankt-Peterburg PAO (BSPB.ME) is 14.5%.
| Range | Selected | |
| Cost of equity | 20.10% - 22.30% | 21.20% |
| Tax rate | 20.00% - 21.10% | 20.55% |
| Cost of debt | 5.00% - 5.00% | 5.00% |
| WACC | 13.8% - 15.1% | 14.5% |
| Category | Low | High |
| Long-term bond rate | 15.8% | 16.3% |
| Equity market risk premium | 11.7% | 12.7% |
| Adjusted beta | 0.36 | 0.43 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 20.10% | 22.30% |
| Tax rate | 20.00% | 21.10% |
| Debt/Equity ratio | 0.64 | 0.64 |
| Cost of debt | 5.00% | 5.00% |
| After-tax WACC | 13.8% | 15.1% |
| Selected WACC | 14.5% | |
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 BSPB.ME:
cost_of_equity (21.20%) = risk_free_rate (16.05%) + equity_risk_premium (12.20%) * adjusted_beta (0.36) + 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.