5VS.SI WACC - Weighted Average Cost of Capital

The WACC of Hafary Holdings Ltd (5VS.SI) is 4.2%.

The Cost of Equity of Hafary Holdings Ltd (5VS.SI) is 5.75%.

The Cost of Debt of Hafary Holdings Ltd (5VS.SI) is 4.25%.

	Range	Selected
Cost of equity	4.70% - 6.80%	5.75%
Tax rate	18.30% - 18.50%	18.40%
Cost of debt	4.00% - 4.50%	4.25%
WACC	3.7% - 4.7%	4.2%

WACC

5VS.SI WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.39	0.51

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.70%	6.80%

Tax rate	18.30%	18.50%
Debt/Equity ratio	2.01	2.01
Cost of debt	4.00%	4.50%

After-tax WACC	3.7%	4.7%


Selected WACC	4.2%

5VS.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 5VS.SI:

cost_of_equity (5.75%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.39) + 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.