TIM.WA WACC - Weighted Average Cost of Capital
The WACC of Tim SA (TIM.WA) is 8.6%.
| Range | Selected | |
| Cost of equity | 8.0% - 10.1% | 9.05% |
| Tax rate | 20.5% - 21.2% | 20.85% |
| Cost of debt | 6.6% - 7.3% | 6.95% |
| WACC | 7.7% - 9.5% | 8.6% |
| Category | Low | High |
| Long-term bond rate | 5.5% | 6.0% |
| Equity market risk premium | 6.3% | 7.3% |
| Adjusted beta | 0.4 | 0.49 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.0% | 10.1% |
| Tax rate | 20.5% | 21.2% |
| Debt/Equity ratio | 0.16 | 0.16 |
| Cost of debt | 6.6% | 7.3% |
| After-tax WACC | 7.7% | 9.5% |
| Selected WACC | 8.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TIM.WA | Tim SA | 0.16 | 0.2 | 0.18 |
| BOW.WA | Bowim SA | 0.23 | 1.01 | 0.86 |
| ELTON.AT | Elton SA | 0.56 | 0.44 | 0.3 |
| FLO.L | Flowtech Fluidpower PLC | 0.67 | 0.08 | 0.05 |
| GRN.WA | Grodno SA | 0.55 | 0.45 | 0.32 |
| HMU.DE | HMS Bergbau AG | 0.12 | 0 | 0 |
| K1R.DE | KROMI Logistik AG | 0.07 | 0.06 | 0.06 |
| KGL.WA | Korporacja KGL SA | 1.14 | -0.11 | -0.06 |
| LTHM.L | James Latham PLC | 0.04 | 0.26 | 0.25 |
| MEAB B.ST | Malmbergs Elektriska AB (publ) | 0.28 | 0.14 | 0.12 |
| Low | High | |
| Unlevered beta | 0.09 | 0.21 |
| Relevered beta | 0.1 | 0.24 |
| Adjusted relevered beta | 0.4 | 0.49 |
TIM.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 TIM.WA:
cost_of_equity (9.05%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.4) + 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.