RAF.WA WACC - Weighted Average Cost of Capital

The WACC of Fabryka Obrabiarek Rafamet SA (RAF.WA) is 8.8%.

The Cost of Equity of Fabryka Obrabiarek Rafamet SA (RAF.WA) is 9.00%.

The Cost of Debt of Fabryka Obrabiarek Rafamet SA (RAF.WA) is 7.65%.

	Range	Selected
Cost of equity	8.20% - 9.80%	9.00%
Tax rate	11.90% - 14.60%	13.25%
Cost of debt	7.00% - 8.30%	7.65%
WACC	8.0% - 9.6%	8.8%

WACC

RAF.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.43	0.45

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	9.80%

Tax rate	11.90%	14.60%
Debt/Equity ratio	0.09	0.09
Cost of debt	7.00%	8.30%

After-tax WACC	8.0%	9.6%


Selected WACC	8.8%

RAF.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 RAF.WA:

cost_of_equity (9.00%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.43) + 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.