DHG.IR WACC - Weighted Average Cost of Capital

The WACC of Dalata Hotel Group PLC (DHG.IR) is 6.7%.

The Cost of Equity of Dalata Hotel Group PLC (DHG.IR) is 7.65%.

The Cost of Debt of Dalata Hotel Group PLC (DHG.IR) is 6.25%.

	Range	Selected
Cost of equity	6.60% - 8.70%	7.65%
Tax rate	12.90% - 14.00%	13.45%
Cost of debt	6.20% - 6.30%	6.25%
WACC	6.1% - 7.2%	6.7%

WACC

DHG.IR WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.66	0.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.60%	8.70%

Tax rate	12.90%	14.00%
Debt/Equity ratio	0.77	0.77
Cost of debt	6.20%	6.30%

After-tax WACC	6.1%	7.2%


Selected WACC	6.7%

DHG.IR'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 DHG.IR:

cost_of_equity (7.65%) = risk_free_rate (2.95%) + equity_risk_premium (6.50%) * adjusted_beta (0.66) + 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.