5GD.SI WACC - Weighted Average Cost of Capital

The WACC of Sunpower Group Ltd (5GD.SI) is 7.8%.

The Cost of Equity of Sunpower Group Ltd (5GD.SI) is 21.65%.

The Cost of Debt of Sunpower Group Ltd (5GD.SI) is 6.15%.

	Range	Selected
Cost of equity	17.40% - 25.90%	21.65%
Tax rate	22.70% - 25.20%	23.95%
Cost of debt	4.90% - 7.40%	6.15%
WACC	6.3% - 9.3%	7.8%

WACC

5GD.SI WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	2.87	3.64

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.40%	25.90%

Tax rate	22.70%	25.20%
Debt/Equity ratio	4.51	4.51
Cost of debt	4.90%	7.40%

After-tax WACC	6.3%	9.3%


Selected WACC	7.8%

5GD.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 5GD.SI:

cost_of_equity (21.65%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (2.87) + 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.