KC.BK WACC - Weighted Average Cost of Capital

The WACC of KC Property PCL (KC.BK) is 5.2%.

The Cost of Equity of KC Property PCL (KC.BK) is 7.55%.

The Cost of Debt of KC Property PCL (KC.BK) is 4.25%.

	Range	Selected
Cost of equity	5.70% - 9.40%	7.55%
Tax rate	-% - 0.40%	0.20%
Cost of debt	4.00% - 4.50%	4.25%
WACC	4.5% - 5.9%	5.2%

WACC

KC.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.43	0.69

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.70%	9.40%

Tax rate	-%	0.40%
Debt/Equity ratio	2.37	2.37
Cost of debt	4.00%	4.50%

After-tax WACC	4.5%	5.9%


Selected WACC	5.2%

KC.BK'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 KC.BK:

cost_of_equity (7.55%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.43) + 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.