TPE.WA WACC - Weighted Average Cost of Capital

The WACC of Tauron Polska Energia SA (TPE.WA) is 7.2%.

The Cost of Equity of Tauron Polska Energia SA (TPE.WA) is 11.00%.

The Cost of Debt of Tauron Polska Energia SA (TPE.WA) is 5.20%.

	Range	Selected
Cost of equity	9.70% - 12.30%	11.00%
Tax rate	28.70% - 45.80%	37.25%
Cost of debt	4.00% - 6.40%	5.20%
WACC	6.3% - 8.0%	7.2%

WACC

TPE.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.65	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.70%	12.30%

Tax rate	28.70%	45.80%
Debt/Equity ratio	0.96	0.96
Cost of debt	4.00%	6.40%

After-tax WACC	6.3%	8.0%


Selected WACC	7.2%

TPE.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 TPE.WA:

cost_of_equity (11.00%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.65) + 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.