BUKK.JK WACC - Weighted Average Cost of Capital

The WACC of Bukaka Teknik Utama Tbk PT (BUKK.JK) is 9.5%.

The Cost of Equity of Bukaka Teknik Utama Tbk PT (BUKK.JK) is 15.35%.

The Cost of Debt of Bukaka Teknik Utama Tbk PT (BUKK.JK) is 5.50%.

	Range	Selected
Cost of equity	13.30% - 17.40%	15.35%
Tax rate	16.30% - 17.20%	16.75%
Cost of debt	4.00% - 7.00%	5.50%
WACC	7.9% - 11.1%	9.5%

WACC

BUKK.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.85	1.1

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.30%	17.40%

Tax rate	16.30%	17.20%
Debt/Equity ratio	1.19	1.19
Cost of debt	4.00%	7.00%

After-tax WACC	7.9%	11.1%


Selected WACC	9.5%

BUKK.JK'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 BUKK.JK:

cost_of_equity (15.35%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.85) + 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.