EMAAR.DB WACC - Weighted Average Cost of Capital

The WACC of Emaar Properties PJSC (EMAAR.DB) is 12.1%.

The Cost of Equity of Emaar Properties PJSC (EMAAR.DB) is 12.75%.

The Cost of Debt of Emaar Properties PJSC (EMAAR.DB) is 5.90%.

	Range	Selected
Cost of equity	11.20% - 14.30%	12.75%
Tax rate	5.60% - 7.00%	6.30%
Cost of debt	5.30% - 6.50%	5.90%
WACC	10.7% - 13.6%	12.1%

WACC

EMAAR.DB WACC calculation

Category	Low	High

Long-term bond rate	5.9%	6.4%
Equity market risk premium	5.8%	6.8%
Adjusted beta	0.91	1.08

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.20%	14.30%

Tax rate	5.60%	7.00%
Debt/Equity ratio	0.09	0.09
Cost of debt	5.30%	6.50%

After-tax WACC	10.7%	13.6%


Selected WACC	12.1%

EMAAR.DB'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 EMAAR.DB:

cost_of_equity (12.75%) = risk_free_rate (6.15%) + equity_risk_premium (6.30%) * adjusted_beta (0.91) + 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.