NISP.JK
Bank OCBC NISP Tbk PT
Price:  
1,350.00 
IDR
Volume:  
3,658,100.00
Indonesia | Banks
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NISP.JK WACC - Weighted Average Cost of Capital

The WACC of Bank OCBC NISP Tbk PT (NISP.JK) is 8.9%.

The Cost of Equity of Bank OCBC NISP Tbk PT (NISP.JK) is 12.15%.
The Cost of Debt of Bank OCBC NISP Tbk PT (NISP.JK) is 5.00%.

Range Selected
Cost of equity 10.90% - 13.40% 12.15%
Tax rate 21.10% - 21.20% 21.15%
Cost of debt 5.00% - 5.00% 5.00%
WACC 8.1% - 9.6% 8.9%
WACC

NISP.JK WACC calculation

Category Low High
Long-term bond rate 6.6% 7.1%
Equity market risk premium 7.9% 8.9%
Adjusted beta 0.54 0.65
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.90% 13.40%
Tax rate 21.10% 21.20%
Debt/Equity ratio 0.66 0.66
Cost of debt 5.00% 5.00%
After-tax WACC 8.1% 9.6%
Selected WACC 8.9%

NISP.JK'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 NISP.JK:

cost_of_equity (12.15%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.54) + 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.