The WACC of Nizhnekamskneftekhim PAO (NKNC.ME) is 19.1%.
| Range | Selected | |
| Cost of equity | 23.50% - 28.60% | 26.05% |
| Tax rate | 21.60% - 22.90% | 22.25% |
| Cost of debt | 7.00% - 7.00% | 7.00% |
| WACC | 17.5% - 20.8% | 19.1% |
| Category | Low | High |
| Long-term bond rate | 15.8% | 16.3% |
| Equity market risk premium | 11.7% | 12.7% |
| Adjusted beta | 0.66 | 0.93 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 23.50% | 28.60% |
| Tax rate | 21.60% | 22.90% |
| Debt/Equity ratio | 0.5 | 0.5 |
| Cost of debt | 7.00% | 7.00% |
| After-tax WACC | 17.5% | 20.8% |
| Selected WACC | 19.1% | |
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 NKNC.ME:
cost_of_equity (26.05%) = risk_free_rate (16.05%) + equity_risk_premium (12.20%) * adjusted_beta (0.66) + 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.