SHGR.TA WACC - Weighted Average Cost of Capital

The WACC of Shagrir Group Vehicle Services Ltd (SHGR.TA) is 7.2%.

The Cost of Equity of Shagrir Group Vehicle Services Ltd (SHGR.TA) is 9.10%.

The Cost of Debt of Shagrir Group Vehicle Services Ltd (SHGR.TA) is 6.00%.

	Range	Selected
Cost of equity	8.20% - 10.00%	9.10%
Tax rate	24.10% - 40.50%	32.30%
Cost of debt	5.40% - 6.60%	6.00%
WACC	6.6% - 7.7%	7.2%

WACC

SHGR.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.55	0.58

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	10.00%

Tax rate	24.10%	40.50%
Debt/Equity ratio	0.61	0.61
Cost of debt	5.40%	6.60%

After-tax WACC	6.6%	7.7%


Selected WACC	7.2%

SHGR.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 SHGR.TA:

cost_of_equity (9.10%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.55) + 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.