RDN.WA WACC - Weighted Average Cost of Capital

The WACC of Redan SA (RDN.WA) is 5.1%.

The Cost of Equity of Redan SA (RDN.WA) is 10.40%.

The Cost of Debt of Redan SA (RDN.WA) is 5.90%.

	Range	Selected
Cost of equity	8.90% - 11.90%	10.40%
Tax rate	19.00% - 19.00%	19.00%
Cost of debt	4.80% - 7.00%	5.90%
WACC	4.2% - 6.1%	5.1%

WACC

RDN.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.53	0.74

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.90%	11.90%

Tax rate	19.00%	19.00%
Debt/Equity ratio	14.41	14.41
Cost of debt	4.80%	7.00%

After-tax WACC	4.2%	6.1%


Selected WACC	5.1%

RDN.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 RDN.WA:

cost_of_equity (10.40%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.53) + 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.