CTRA.JK WACC - Weighted Average Cost of Capital

The WACC of Ciputra Development Tbk PT (CTRA.JK) is 12.0%.

The Cost of Equity of Ciputra Development Tbk PT (CTRA.JK) is 15.05%.

The Cost of Debt of Ciputra Development Tbk PT (CTRA.JK) is 5.50%.

	Range	Selected
Cost of equity	13.60% - 16.50%	15.05%
Tax rate	2.80% - 2.90%	2.85%
Cost of debt	4.00% - 7.00%	5.50%
WACC	10.6% - 13.5%	12.0%

WACC

CTRA.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.89	1

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.60%	16.50%

Tax rate	2.80%	2.90%
Debt/Equity ratio	0.45	0.45
Cost of debt	4.00%	7.00%

After-tax WACC	10.6%	13.5%


Selected WACC	12.0%

CTRA.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 CTRA.JK:

cost_of_equity (15.05%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.89) + 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.