CRM.WA WACC - Weighted Average Cost of Capital

The WACC of PZ Cormay SA (CRM.WA) is 10.2%.

The Cost of Equity of PZ Cormay SA (CRM.WA) is 10.50%.

The Cost of Debt of PZ Cormay SA (CRM.WA) is 8.20%.

	Range	Selected
Cost of equity	9.00% - 12.00%	10.50%
Tax rate	3.30% - 7.80%	5.55%
Cost of debt	7.00% - 9.40%	8.20%
WACC	8.7% - 11.7%	10.2%

WACC

CRM.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.54	0.75

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.00%	12.00%

Tax rate	3.30%	7.80%
Debt/Equity ratio	0.12	0.12
Cost of debt	7.00%	9.40%

After-tax WACC	8.7%	11.7%


Selected WACC	10.2%

CRM.WA'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 CRM.WA:

cost_of_equity (10.50%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.54) + 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.