The WACC of Smart Invest Securities JSC (AAS.VN) is 13.1%.
| Range | Selected | |
| Cost of equity | 9.10% - 14.10% | 11.60% |
| Tax rate | 20.30% - 21.40% | 20.85% |
| Cost of debt | 4.00% - 32.10% | 18.05% |
| WACC | 5.6% - 20.6% | 13.1% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.67 | 0.98 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.10% | 14.10% |
| Tax rate | 20.30% | 21.40% |
| Debt/Equity ratio | 1.4 | 1.4 |
| Cost of debt | 4.00% | 32.10% |
| After-tax WACC | 5.6% | 20.6% |
| Selected WACC | 13.1% | |
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 AAS.VN:
cost_of_equity (11.60%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.67) + 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.