The WACC of Thai Film Industries PCL (TFI.BK) is 10.2%.
| Range | Selected | |
| Cost of equity | 5.50% - 7.60% | 6.55% |
| Tax rate | 8.30% - 9.10% | 8.70% |
| Cost of debt | 7.00% - 30.80% | 18.90% |
| WACC | 5.8% - 14.6% | 10.2% |
| Category | Low | High |
| Long-term bond rate | 2.6% | 3.1% |
| Equity market risk premium | 7.4% | 8.4% |
| Adjusted beta | 0.32 | 0.41 |
| Additional risk adjustments | 0.5% | 1.0% |
| Cost of equity | 5.50% | 7.60% |
| Tax rate | 8.30% | 9.10% |
| Debt/Equity ratio | 0.53 | 0.53 |
| Cost of debt | 7.00% | 30.80% |
| After-tax WACC | 5.8% | 14.6% |
| Selected WACC | 10.2% | |
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 TFI.BK:
cost_of_equity (6.55%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.32) + risk_adjustments (0.75%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.