PMTA.BK WACC - Weighted Average Cost of Capital

The WACC of PM Thoresen Asia Holdings PCL (PMTA.BK) is 10.0%.

The Cost of Equity of PM Thoresen Asia Holdings PCL (PMTA.BK) is 12.65%.

The Cost of Debt of PM Thoresen Asia Holdings PCL (PMTA.BK) is 5.50%.

	Range	Selected
Cost of equity	10.40% - 14.90%	12.65%
Tax rate	21.30% - 22.80%	22.05%
Cost of debt	4.00% - 7.00%	5.50%
WACC	8.1% - 11.9%	10.0%

WACC

PMTA.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	1.05	1.34

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.40%	14.90%

Tax rate	21.30%	22.80%
Debt/Equity ratio	0.45	0.45
Cost of debt	4.00%	7.00%

After-tax WACC	8.1%	11.9%


Selected WACC	10.0%

PMTA.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 PMTA.BK:

cost_of_equity (12.65%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (1.05) + 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.