PZOL.TA WACC - Weighted Average Cost of Capital
The WACC of Paz Oil Company Ltd (PZOL.TA) is 7.0%.
| Range | Selected | |
| Cost of equity | 8.9% - 12.6% | 10.75% |
| Tax rate | 18.7% - 20.0% | 19.35% |
| Cost of debt | 4.0% - 6.0% | 5% |
| WACC | 5.7% - 8.3% | 7.0% |
| Category | Low | High |
| Long-term bond rate | 4.8% | 5.3% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.66 | 0.96 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.9% | 12.6% |
| Tax rate | 18.7% | 20.0% |
| Debt/Equity ratio | 1.25 | 1.25 |
| Cost of debt | 4.0% | 6.0% |
| After-tax WACC | 5.7% | 8.3% |
| Selected WACC | 7.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PZOL.TA | Paz Oil Company Ltd | 1.25 | 1.06 | 0.53 |
| 2380.SR | Rabigh Refining and Petrochemical Company SJSC | 2.73 | 0.31 | 0.1 |
| 5017.T | Fuji Oil Co Ltd | 6.13 | 1.11 | 0.19 |
| BCP.BK | Bangchak Corporation PCL | 2.69 | 0.85 | 0.27 |
| BSR.VN | Binh Son Refining and Petrochemical JSC | 0.2 | 1.53 | 1.32 |
| ESSO.BK | Esso Thailand PCL | 1.27 | 0.8 | 0.4 |
| HENGYUAN.KL | Hengyuan Refining Company Bhd | 2.64 | 0.18 | 0.06 |
| IRPC.BK | IRPC PCL | 4 | 1.93 | 0.46 |
| PETRONM.KL | Petron Malaysia Refining & Marketing Bhd | 1.06 | 0.39 | 0.21 |
| SPRC.BK | Star Petroleum Refining PCL | 0.39 | 1.15 | 0.88 |
| Low | High | |
| Unlevered beta | 0.24 | 0.42 |
| Relevered beta | 0.49 | 0.94 |
| Adjusted relevered beta | 0.66 | 0.96 |
PZOL.TA'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 PZOL.TA:
cost_of_equity (10.75%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * 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.