TPE.WA WACC - Weighted Average Cost of Capital
The WACC of Tauron Polska Energia SA (TPE.WA) is 6.9%.
| Range | Selected | |
| Cost of equity | 10.1% - 12.3% | 11.2% |
| Tax rate | 28.7% - 45.8% | 37.25% |
| Cost of debt | 4.0% - 6.6% | 5.3% |
| WACC | 6.2% - 7.6% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 5.5% | 6.0% |
| Equity market risk premium | 6.3% | 7.3% |
| Adjusted beta | 0.73 | 0.79 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.1% | 12.3% |
| Tax rate | 28.7% | 45.8% |
| Debt/Equity ratio | 1.17 | 1.17 |
| Cost of debt | 4.0% | 6.6% |
| After-tax WACC | 6.2% | 7.6% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TPE.WA | Tauron Polska Energia SA | 1.17 | 0.61 | 0.34 |
| BKW.SW | BKW AG | 0.2 | 0.4 | 0.35 |
| EDHN.SW | Energiedienst Holding AG | 0.08 | 0.24 | 0.23 |
| ELI.BR | Elia Group SA | 1.42 | 0.63 | 0.32 |
| ENA.WA | Enea SA | 0.79 | 0.72 | 0.47 |
| ENG.WA | Energa SA | 2.44 | 0.28 | 0.1 |
| EVN.VI | EVN AG | 0.28 | 0.65 | 0.54 |
| PPC.AT | Public Power Corporation SA | 1.54 | 0.87 | 0.42 |
| REE.MC | Red Electrica Corporacion SA | 0.74 | 0.3 | 0.2 |
| VER.VI | Verbund AG | 0.22 | 0.59 | 0.52 |
| Low | High | |
| Unlevered beta | 0.33 | 0.38 |
| Relevered beta | 0.6 | 0.69 |
| Adjusted relevered beta | 0.73 | 0.79 |
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 (11.20%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.73) + 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.