PPC.AT WACC - Weighted Average Cost of Capital

The WACC of Public Power Corporation SA (PPC.AT) is 6.7%.

The Cost of Equity of Public Power Corporation SA (PPC.AT) is 11.40%.

The Cost of Debt of Public Power Corporation SA (PPC.AT) is 4.70%.

	Range	Selected
Cost of equity	10.10% - 12.70%	11.40%
Tax rate	23.20% - 24.00%	23.60%
Cost of debt	4.30% - 5.10%	4.70%
WACC	6.0% - 7.4%	6.7%

WACC

PPC.AT WACC calculation

Category	Low	High

Long-term bond rate	3.3%	3.8%
Equity market risk premium	8.8%	9.8%
Adjusted beta	0.77	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.10%	12.70%

Tax rate	23.20%	24.00%
Debt/Equity ratio	1.51	1.51
Cost of debt	4.30%	5.10%

After-tax WACC	6.0%	7.4%


Selected WACC	6.7%

PPC.AT'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 PPC.AT:

cost_of_equity (11.40%) = risk_free_rate (3.55%) + equity_risk_premium (9.30%) * adjusted_beta (0.77) + 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.