GZCO.JK WACC - Weighted Average Cost of Capital

The WACC of Gozco Plantations Tbk PT (GZCO.JK) is 10.7%.

The Cost of Equity of Gozco Plantations Tbk PT (GZCO.JK) is 15.45%.

The Cost of Debt of Gozco Plantations Tbk PT (GZCO.JK) is 5.50%.

	Range	Selected
Cost of equity	13.00% - 17.90%	15.45%
Tax rate	21.20% - 45.80%	33.50%
Cost of debt	4.00% - 7.00%	5.50%
WACC	9.1% - 12.3%	10.7%

WACC

GZCO.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.82	1.15

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.00%	17.90%

Tax rate	21.20%	45.80%
Debt/Equity ratio	0.66	0.66
Cost of debt	4.00%	7.00%

After-tax WACC	9.1%	12.3%


Selected WACC	10.7%

GZCO.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 GZCO.JK:

cost_of_equity (15.45%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.82) + 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.