5TT.SI WACC - Weighted Average Cost of Capital

The WACC of Keong Hong Holdings Ltd (5TT.SI) is 7.5%.

The Cost of Equity of Keong Hong Holdings Ltd (5TT.SI) is 9.90%.

The Cost of Debt of Keong Hong Holdings Ltd (5TT.SI) is 6.10%.

	Range	Selected
Cost of equity	7.60% - 12.20%	9.90%
Tax rate	1.30% - 6.70%	4.00%
Cost of debt	5.20% - 7.00%	6.10%
WACC	6.2% - 8.9%	7.5%

WACC

5TT.SI WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.95	1.39

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.60%	12.20%

Tax rate	1.30%	6.70%
Debt/Equity ratio	1.43	1.43
Cost of debt	5.20%	7.00%

After-tax WACC	6.2%	8.9%


Selected WACC	7.5%

5TT.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 5TT.SI:

cost_of_equity (9.90%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.95) + 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.