MILL.BK WACC - Weighted Average Cost of Capital

The WACC of Millcon Steel PCL (MILL.BK) is 6.5%.

The Cost of Equity of Millcon Steel PCL (MILL.BK) is 17.60%.

The Cost of Debt of Millcon Steel PCL (MILL.BK) is 5.70%.

	Range	Selected
Cost of equity	13.50% - 21.70%	17.60%
Tax rate	0.20% - 0.90%	0.55%
Cost of debt	4.40% - 7.00%	5.70%
WACC	5.0% - 7.9%	6.5%

WACC

MILL.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	1.48	2.15

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.50%	21.70%

Tax rate	0.20%	0.90%
Debt/Equity ratio	14.46	14.46
Cost of debt	4.40%	7.00%

After-tax WACC	5.0%	7.9%


Selected WACC	6.5%

MILL.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 MILL.BK:

cost_of_equity (17.60%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (1.48) + 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.