ILLA.MI WACC - Weighted Average Cost of Capital
The WACC of ILLA SpA (ILLA.MI) is 4.8%.
| Range | Selected | |
| Cost of equity | 5.6% - 11.2% | 8.4% |
| Tax rate | 4.9% - 6.6% | 5.75% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.8% - 4.9% | 4.8% |
| Category | Low | High |
| Long-term bond rate | 3.7% | 4.2% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.23 | 0.71 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.6% | 11.2% |
| Tax rate | 4.9% | 6.6% |
| Debt/Equity ratio | 27.95 | 27.95 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.8% | 4.9% |
| Selected WACC | 4.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ILLA.MI | ILLA SpA | 27.95 | -0.51 | -0.02 |
| CHH.L | Churchill China PLC | 0.02 | 0.64 | 0.63 |
| GBUS.MI | Gibus SpA | 0.8 | 0.09 | 0.05 |
| KUTPO.IS | Kutahya Porselen Sanayi AS | 0.04 | 1.45 | 1.4 |
| NBZ.ST | Northbaze Group AB | 0.54 | 0.02 | 0.01 |
| PMP.L | Portmeirion Group PLC | 1.32 | -0.5 | -0.22 |
| PORF.AS | Koninklijke Porceleyne Fles NV | 1.47 | 0.08 | 0.03 |
| VAF.LS | VAA Vista Alegre Atlantis SGPS SA | 0.54 | 0.01 | 0 |
| CTIB | Yunhong CTI Ltd | 0.1 | -0.44 | -0.4 |
| PTE.V | Pioneering Technology Corp | 1.65 | -1.98 | -0.78 |
| Low | High | |
| Unlevered beta | -0.01 | 0.02 |
| Relevered beta | -0.15 | 0.57 |
| Adjusted relevered beta | 0.23 | 0.71 |
ILLA.MI'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 ILLA.MI:
cost_of_equity (8.40%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.23) + 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.