PMP.WA WACC - Weighted Average Cost of Capital

The WACC of Pamapol SA (PMP.WA) is 12.2%.

The Cost of Equity of Pamapol SA (PMP.WA) is 9.30%.

The Cost of Debt of Pamapol SA (PMP.WA) is 16.00%.

	Range	Selected
Cost of equity	8.10% - 10.50%	9.30%
Tax rate	16.30% - 17.50%	16.90%
Cost of debt	6.50% - 25.50%	16.00%
WACC	6.2% - 18.2%	12.2%

WACC

PMP.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.41	0.55

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.10%	10.50%

Tax rate	16.30%	17.50%
Debt/Equity ratio	2.69	2.69
Cost of debt	6.50%	25.50%

After-tax WACC	6.2%	18.2%


Selected WACC	12.2%

PMP.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 PMP.WA:

cost_of_equity (9.30%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.41) + 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.