GTS.WA WACC - Weighted Average Cost of Capital

The WACC of Geotrans SA (GTS.WA) is 8.8%.

The Cost of Equity of Geotrans SA (GTS.WA) is 8.85%.

The Cost of Debt of Geotrans SA (GTS.WA) is 6.10%.

	Range	Selected
Cost of equity	8.10% - 9.60%	8.85%
Tax rate	16.60% - 19.30%	17.95%
Cost of debt	6.10% - 6.10%	6.10%
WACC	8.1% - 9.6%	8.8%

WACC

GTS.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.4	0.42

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.10%	9.60%

Tax rate	16.60%	19.30%
Debt/Equity ratio	0	0
Cost of debt	6.10%	6.10%

After-tax WACC	8.1%	9.6%


Selected WACC	8.8%

GTS.WA'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 GTS.WA:

cost_of_equity (8.85%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.4) + 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.