LODZ.TA WACC - Weighted Average Cost of Capital

The WACC of Lodzia Rotex Investment Ltd (LODZ.TA) is 6.9%.

The Cost of Equity of Lodzia Rotex Investment Ltd (LODZ.TA) is 13.40%.

The Cost of Debt of Lodzia Rotex Investment Ltd (LODZ.TA) is 5.00%.

	Range	Selected
Cost of equity	10.10% - 16.70%	13.40%
Tax rate	22.90% - 25.50%	24.20%
Cost of debt	5.00% - 5.00%	5.00%
WACC	5.9% - 7.9%	6.9%

WACC

LODZ.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.87	1.53

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.10%	16.70%

Tax rate	22.90%	25.50%
Debt/Equity ratio	2.1	2.1
Cost of debt	5.00%	5.00%

After-tax WACC	5.9%	7.9%


Selected WACC	6.9%

LODZ.TA'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 LODZ.TA:

cost_of_equity (13.40%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.87) + 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.