CLAY.JK WACC - Weighted Average Cost of Capital

The WACC of Citra Putra Realty Tbk PT (CLAY.JK) is 8.1%.

The Cost of Equity of Citra Putra Realty Tbk PT (CLAY.JK) is 8.50%.

The Cost of Debt of Citra Putra Realty Tbk PT (CLAY.JK) is 5.50%.

	Range	Selected
Cost of equity	7.20% - 9.80%	8.50%
Tax rate	16.80% - 33.10%	24.95%
Cost of debt	4.00% - 7.00%	5.50%
WACC	6.8% - 9.4%	8.1%

WACC

CLAY.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.07	0.25

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.20%	9.80%

Tax rate	16.80%	33.10%
Debt/Equity ratio	0.09	0.09
Cost of debt	4.00%	7.00%

After-tax WACC	6.8%	9.4%


Selected WACC	8.1%

CLAY.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 CLAY.JK:

cost_of_equity (8.50%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.07) + 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.