ZAP.WA WACC - Weighted Average Cost of Capital

The WACC of Grupa Azoty Zaklady Azotowe Pulawy SA (ZAP.WA) is 9.3%.

The Cost of Equity of Grupa Azoty Zaklady Azotowe Pulawy SA (ZAP.WA) is 12.85%.

The Cost of Debt of Grupa Azoty Zaklady Azotowe Pulawy SA (ZAP.WA) is 6.95%.

	Range	Selected
Cost of equity	10.90% - 14.80%	12.85%
Tax rate	16.10% - 20.00%	18.05%
Cost of debt	6.90% - 7.00%	6.95%
WACC	8.3% - 10.2%	9.3%

WACC

ZAP.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.84	1.14

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.90%	14.80%

Tax rate	16.10%	20.00%
Debt/Equity ratio	1	1
Cost of debt	6.90%	7.00%

After-tax WACC	8.3%	10.2%


Selected WACC	9.3%

ZAP.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 ZAP.WA:

cost_of_equity (12.85%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.84) + 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.