The WACC of Korporacja KGL SA (KGL.WA) is 6.0%.
Range | Selected | |
Cost of equity | 7.7% - 9.6% | 8.65% |
Tax rate | 20.0% - 22.4% | 21.2% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 5.6% - 6.4% | 6.0% |
Category | Low | High |
Long-term bond rate | 5.5% | 6.0% |
Equity market risk premium | 6.3% | 7.3% |
Adjusted beta | 0.35 | 0.42 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.7% | 9.6% |
Tax rate | 20.0% | 22.4% |
Debt/Equity ratio | 1.26 | 1.26 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 5.6% | 6.4% |
Selected WACC | 6.0% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
KGL.WA | Korporacja KGL SA | 1.26 | -0.12 | -0.06 |
BMTO.L | Braime Group PLC | 0.23 | -0.09 | -0.07 |
BRG.WA | Berling SA | 0.08 | -0.1 | -0.1 |
ELTON.AT | Elton SA | 0.57 | 0.3 | 0.21 |
FLO.L | Flowtech Fluidpower PLC | 0.57 | 0.2 | 0.14 |
FNM.ST | Ferronordic AB | 3.3 | 0.32 | 0.09 |
HMU.DE | HMS Bergbau AG | 0.12 | 0.07 | 0.06 |
K1R.DE | KROMI Logistik AG | 0.07 | 0.06 | 0.06 |
KCH.WA | Krakchemia SA | 0.42 | -0.39 | -0.29 |
MEAB B.ST | Malmbergs Elektriska AB (publ) | 0.29 | 0.09 | 0.07 |
Low | High | |
Unlevered beta | 0.01 | 0.07 |
Relevered beta | 0.03 | 0.13 |
Adjusted relevered beta | 0.35 | 0.42 |
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 KGL.WA:
cost_of_equity (8.65%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.35) + 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.