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Weighted Average Cost of Capital (WACC) - 2017 Value Weight Required Rate of Return

This document provides information to calculate the weighted average cost of capital (WACC) for 2017 and 2016. For 2017, the WACC is calculated to be 6.91% using a cost of equity of 8.57%, cost of debt of 4.42%, equity value weight of 60% and debt value weight of 40%. Debt is calculated to have a weighted average interest rate of 5.06% and cost of debt of 4.42% based on various debt instruments and amounts. Similarly for 2016, the WACC is calculated to be 4.8% using a cost of equity of 4.5%, cost of debt of 5.21%, equity weight of 60% and debt weight of 40%.

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63 views4 pages

Weighted Average Cost of Capital (WACC) - 2017 Value Weight Required Rate of Return

This document provides information to calculate the weighted average cost of capital (WACC) for 2017 and 2016. For 2017, the WACC is calculated to be 6.91% using a cost of equity of 8.57%, cost of debt of 4.42%, equity value weight of 60% and debt value weight of 40%. Debt is calculated to have a weighted average interest rate of 5.06% and cost of debt of 4.42% based on various debt instruments and amounts. Similarly for 2016, the WACC is calculated to be 4.8% using a cost of equity of 4.5%, cost of debt of 5.21%, equity weight of 60% and debt weight of 40%.

Uploaded by

ravinyse
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as XLSX, PDF, TXT or read online on Scribd
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Weighted Average Cost of Capital (WACC)-2017

Value Weight Required rate of return


Equity (fair value) 194,755 0.6 8.57%
Debt (fair value) 129,678 0.4 4.42%
Total 324,433 1
WACC
Rf on Treasury Composite 2.98
Market return 12.52
Beta 0.59
Expected Tax Rate 12.62
Required rate of return 8.61

Interest Rate (%) Debt Amount I*D


3.960% 31370 1242.252
0.0551 67906 3741.621
0.069 5835 402.615
0.090 1106 98.987
0.079 234 18.4392
0.065 226 14.69
0.079 341 26.8708
0.088 229 20.0375
0.088 748 65.45
0.027 6293 166.7645
0.036 1020 36.72
Total 115308 5834.447
Weighted Avreage Interest rate 5.06
Cost of Debt 4.42

WACC 6.91
Weighted Average Cost of Capital (WACC)-2016
Value Weight Required rate of return
Equity (fair value) 194,755 0.6 4.50%
Debt (fair value) 117,584 0.4 5.21%
Total 312,339 1

Rf on Treasury Composite 2.98


Market return 12.52
Beta 0.59
Expected Tax Rate 12.62
Expected rate of return 8.61
4.8

Interest Rate (%) Debt Amount I*D


3.960% 28491 1128.24
0.0551 53909 2970.39
0.069 11295 779.355
0.090 1860 166.47
0.079 525 41.37
0.065 319 20.735
0.079 561 44.2068
0.088 328 28.7
0.088 1102 96.425
0.027 2485 65.8525
0.036 950 34.2
Total 101825 5375.94
Weighted Avreage Interest rate 5.28
Cost of Debt 5.21
0.0396 31,370 1,242 1242.252
0.0551 67,906 3,742
0.069 5,835 403
0.0895 1,106 99
0.0788 234 18
0.065 226 15
0.0788 341 27
0.0875 229 20
0.0875 748 65
0.0265 6,293 167
0.036 1,020 37
31,370 
5.51%
6.90%
8.95%
7.88%
6.50%
7.88%
8.75%
8.75%
2.65%
3.60%

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