ZOREN.IS WACC - Weighted Average Cost of Capital

The WACC of Zorlu Enerji Elektrik Uretim AS (ZOREN.IS) is 18.7%.

The Cost of Equity of Zorlu Enerji Elektrik Uretim AS (ZOREN.IS) is 32.90%.

The Cost of Debt of Zorlu Enerji Elektrik Uretim AS (ZOREN.IS) is 18.90%.

	Range	Selected
Cost of equity	30.90% - 34.90%	32.90%
Tax rate	21.20% - 22.00%	21.60%
Cost of debt	10.50% - 27.30%	18.90%
WACC	13.1% - 24.2%	18.7%

WACC

ZOREN.IS WACC calculation

Category	Low	High

Long-term bond rate	21.4%	21.9%
Equity market risk premium	10.2%	11.2%
Adjusted beta	0.94	1.12

Additional risk adjustments	0.0%	0.5%
Cost of equity	30.90%	34.90%

Tax rate	21.20%	22.00%
Debt/Equity ratio	3.68	3.68
Cost of debt	10.50%	27.30%

After-tax WACC	13.1%	24.2%


Selected WACC	18.7%

ZOREN.IS'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 ZOREN.IS:

cost_of_equity (32.90%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.94) + 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.