TAE.BK WACC - Weighted Average Cost of Capital

The WACC of Thai Agro Energy PCL (TAE.BK) is 8.5%.

The Cost of Equity of Thai Agro Energy PCL (TAE.BK) is 9.50%.

The Cost of Debt of Thai Agro Energy PCL (TAE.BK) is 9.15%.

	Range	Selected
Cost of equity	8.20% - 10.80%	9.50%
Tax rate	18.70% - 20.40%	19.55%
Cost of debt	4.00% - 14.30%	9.15%
WACC	5.9% - 11.1%	8.5%

WACC

TAE.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.76	0.86

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	10.80%

Tax rate	18.70%	20.40%
Debt/Equity ratio	0.85	0.85
Cost of debt	4.00%	14.30%

After-tax WACC	5.9%	11.1%


Selected WACC	8.5%

TAE.BK'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 TAE.BK:

cost_of_equity (9.50%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.76) + 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.