CTBN.JK WACC - Weighted Average Cost of Capital

The WACC of Citra Tubindo Tbk PT (CTBN.JK) is 13.4%.

The Cost of Equity of Citra Tubindo Tbk PT (CTBN.JK) is 13.40%.

The Cost of Debt of Citra Tubindo Tbk PT (CTBN.JK) is 5.50%.

	Range	Selected
Cost of equity	12.20% - 14.60%	13.40%
Tax rate	12.00% - 17.80%	14.90%
Cost of debt	4.00% - 7.00%	5.50%
WACC	12.2% - 14.5%	13.4%

WACC

CTBN.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.71	0.78

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.20%	14.60%

Tax rate	12.00%	17.80%
Debt/Equity ratio	0	0
Cost of debt	4.00%	7.00%

After-tax WACC	12.2%	14.5%


Selected WACC	13.4%

CTBN.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 CTBN.JK:

cost_of_equity (13.40%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.71) + 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.