566.SI WACC - Weighted Average Cost of Capital
The WACC of SHS Holdings Ltd (566.SI) is 5.8%.
| Range | Selected | |
| Cost of equity | 5.2% - 7.1% | 6.15% |
| Tax rate | 4.3% - 9.5% | 6.9% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 5.0% - 6.6% | 5.8% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.39 | 0.47 |
| Additional risk adjustments | 0.5% | 1.0% |
| Cost of equity | 5.2% | 7.1% |
| Tax rate | 4.3% | 9.5% |
| Debt/Equity ratio | 0.17 | 0.17 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 5.0% | 6.6% |
| Selected WACC | 5.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 566.SI | SHS Holdings Ltd | 0.17 | 0.15 | 0.13 |
| 1726.HK | HKE Holdings Ltd | 0 | 0.09 | 0.09 |
| 5CF.SI | OKP Holdings Ltd | 0.09 | -0.21 | -0.19 |
| 5F4.SI | Figtree Holdings Ltd | 1.12 | -0.76 | -0.37 |
| 5UO.SI | Sysma Holdings Ltd | 0.43 | -0.34 | -0.24 |
| 5VC.SI | KORI Holdings Ltd | 0.23 | 1.12 | 0.92 |
| 5VI.SI | Boldtek Holdings Ltd | 2.27 | 0.18 | 0.06 |
| BBP.SI | Hor Kew Corporation Ltd | 0.67 | 0.92 | 0.57 |
| J2T.SI | Hock Lian Seng Holdings Ltd | 0 | 0.28 | 0.28 |
| MR7.SI | Nordic Group Ltd | 0.42 | 0.36 | 0.26 |
| Low | High | |
| Unlevered beta | 0.08 | 0.18 |
| Relevered beta | 0.09 | 0.21 |
| Adjusted relevered beta | 0.39 | 0.47 |
566.SI'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 566.SI:
cost_of_equity (6.15%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.39) + risk_adjustments (0.75%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.