MIL.WA WACC - Weighted Average Cost of Capital

The WACC of Bank Millennium SA (MIL.WA) is 8.4%.

The Cost of Equity of Bank Millennium SA (MIL.WA) is 10.70%.

The Cost of Debt of Bank Millennium SA (MIL.WA) is 5.00%.

	Range	Selected
Cost of equity	9.60% - 11.80%	10.70%
Tax rate	36.50% - 45.80%	41.15%
Cost of debt	5.00% - 5.00%	5.00%
WACC	7.7% - 9.1%	8.4%

WACC

MIL.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.65	0.72

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.60%	11.80%

Tax rate	36.50%	45.80%
Debt/Equity ratio	0.42	0.42
Cost of debt	5.00%	5.00%

After-tax WACC	7.7%	9.1%


Selected WACC	8.4%

MIL.WA'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 MIL.WA:

cost_of_equity (10.70%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.65) + 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.