RICHTER.BD WACC - Weighted Average Cost of Capital

The WACC of Richter Gedeon Vegyeszeti Gyar Nyrt (RICHTER.BD) is 13.0%.

The Cost of Equity of Richter Gedeon Vegyeszeti Gyar Nyrt (RICHTER.BD) is 13.00%.

The Cost of Debt of Richter Gedeon Vegyeszeti Gyar Nyrt (RICHTER.BD) is 14.70%.

	Range	Selected
Cost of equity	11.80% - 14.20%	13.00%
Tax rate	5.30% - 7.00%	6.15%
Cost of debt	7.00% - 22.40%	14.70%
WACC	11.6% - 14.4%	13.0%

WACC

RICHTER.BD WACC calculation

Category	Low	High

Long-term bond rate	6.4%	6.9%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.68	0.76

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.80%	14.20%

Tax rate	5.30%	7.00%
Debt/Equity ratio	0.04	0.04
Cost of debt	7.00%	22.40%

After-tax WACC	11.6%	14.4%


Selected WACC	13.0%

RICHTER.BD'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 RICHTER.BD:

cost_of_equity (13.00%) = risk_free_rate (6.65%) + equity_risk_premium (8.40%) * adjusted_beta (0.68) + 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.