CPIN.JK WACC - Weighted Average Cost of Capital

The WACC of Charoen Pokphand Indonesia Tbk PT (CPIN.JK) is 11.2%.

The Cost of Equity of Charoen Pokphand Indonesia Tbk PT (CPIN.JK) is 11.90%.

The Cost of Debt of Charoen Pokphand Indonesia Tbk PT (CPIN.JK) is 5.50%.

	Range	Selected
Cost of equity	10.20% - 13.60%	11.90%
Tax rate	20.90% - 22.20%	21.55%
Cost of debt	4.00% - 7.00%	5.50%
WACC	9.5% - 12.8%	11.2%

WACC

CPIN.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.46	0.67

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.20%	13.60%

Tax rate	20.90%	22.20%
Debt/Equity ratio	0.11	0.11
Cost of debt	4.00%	7.00%

After-tax WACC	9.5%	12.8%


Selected WACC	11.2%

CPIN.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 CPIN.JK:

cost_of_equity (11.90%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.46) + 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.