HRS.WA WACC - Weighted Average Cost of Capital

The WACC of Herkules SA (HRS.WA) is 6.5%.

The Cost of Equity of Herkules SA (HRS.WA) is 8.35%.

The Cost of Debt of Herkules SA (HRS.WA) is 6.15%.

	Range	Selected
Cost of equity	7.40% - 9.30%	8.35%
Tax rate	18.60% - 23.50%	21.05%
Cost of debt	5.30% - 7.00%	6.15%
WACC	5.8% - 7.3%	6.5%

WACC

HRS.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.3	0.38

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.40%	9.30%

Tax rate	18.60%	23.50%
Debt/Equity ratio	1.06	1.06
Cost of debt	5.30%	7.00%

After-tax WACC	5.8%	7.3%


Selected WACC	6.5%

HRS.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 HRS.WA:

cost_of_equity (8.35%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.3) + 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.