CAST.TA WACC - Weighted Average Cost of Capital

The WACC of Castro Model Ltd (CAST.TA) is 8.8%.

The Cost of Equity of Castro Model Ltd (CAST.TA) is 14.55%.

The Cost of Debt of Castro Model Ltd (CAST.TA) is 6.50%.

	Range	Selected
Cost of equity	12.10% - 17.00%	14.55%
Tax rate	22.20% - 25.00%	23.60%
Cost of debt	5.00% - 8.00%	6.50%
WACC	7.2% - 10.4%	8.8%

WACC

CAST.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	1.19	1.56

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.10%	17.00%

Tax rate	22.20%	25.00%
Debt/Equity ratio	1.5	1.5
Cost of debt	5.00%	8.00%

After-tax WACC	7.2%	10.4%


Selected WACC	8.8%

CAST.TA'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 CAST.TA:

cost_of_equity (14.55%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (1.19) + 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.