KARSN.IS WACC - Weighted Average Cost of Capital

The WACC of Karsan Otomotiv Sanayii ve Ticaret AS (KARSN.IS) is 25.0%.

The Cost of Equity of Karsan Otomotiv Sanayii ve Ticaret AS (KARSN.IS) is 30.90%.

The Cost of Debt of Karsan Otomotiv Sanayii ve Ticaret AS (KARSN.IS) is 16.80%.

	Range	Selected
Cost of equity	28.30% - 33.50%	30.90%
Tax rate	20.70% - 28.40%	24.55%
Cost of debt	9.50% - 24.10%	16.80%
WACC	21.6% - 28.3%	25.0%

WACC

KARSN.IS WACC calculation

Category	Low	High

Long-term bond rate	21.4%	21.9%
Equity market risk premium	10.2%	11.2%
Adjusted beta	0.68	0.99

Additional risk adjustments	0.0%	0.5%
Cost of equity	28.30%	33.50%

Tax rate	20.70%	28.40%
Debt/Equity ratio	0.47	0.47
Cost of debt	9.50%	24.10%

After-tax WACC	21.6%	28.3%


Selected WACC	25.0%

KARSN.IS'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 KARSN.IS:

cost_of_equity (30.90%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.68) + 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.