The WACC of Diginex Ltd (EQOS) is 8.6%.
| Range | Selected | |
| Cost of equity | 11.40% - 14.30% | 12.85% |
| Tax rate | 0.30% - 0.40% | 0.35% |
| Cost of debt | 5.00% - 5.00% | 5.00% |
| WACC | 7.9% - 9.3% | 8.6% |
| Category | Low | High |
| Long-term bond rate | 4.2% | 4.7% |
| Equity market risk premium | 5.0% | 6.0% |
| Adjusted beta | 1.44 | 1.52 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.40% | 14.30% |
| Tax rate | 0.30% | 0.40% |
| Debt/Equity ratio | 1.15 | 1.15 |
| Cost of debt | 5.00% | 5.00% |
| After-tax WACC | 7.9% | 9.3% |
| Selected WACC | 8.6% | |
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 EQOS:
cost_of_equity (12.85%) = risk_free_rate (4.45%) + equity_risk_premium (5.50%) * adjusted_beta (1.44) + 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.