IGAS.L WACC - Weighted Average Cost of Capital

The WACC of IGas Energy PLC (IGAS.L) is 6.8%.

The Cost of Equity of IGas Energy PLC (IGAS.L) is 9.15%.

The Cost of Debt of IGas Energy PLC (IGAS.L) is 7.15%.

	Range	Selected
Cost of equity	7.40% - 10.90%	9.15%
Tax rate	29.70% - 39.00%	34.35%
Cost of debt	7.00% - 7.30%	7.15%
WACC	6.1% - 7.5%	6.8%

WACC

IGAS.L WACC calculation

Category	Low	High

Long-term bond rate	4.4%	4.9%
Equity market risk premium	6.4%	7.4%
Adjusted beta	0.46	0.74

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.40%	10.90%

Tax rate	29.70%	39.00%
Debt/Equity ratio	1.14	1.14
Cost of debt	7.00%	7.30%

After-tax WACC	6.1%	7.5%


Selected WACC	6.8%

IGAS.L'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 IGAS.L:

cost_of_equity (9.15%) = risk_free_rate (4.65%) + equity_risk_premium (6.90%) * adjusted_beta (0.46) + 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.