ACE.BK WACC - Weighted Average Cost of Capital
The WACC of Absolute Clean Energy PCL (ACE.BK) is 6.9%.
| Range | Selected | |
| Cost of equity | 6.9% - 10.3% | 8.6% |
| Tax rate | 6.0% - 6.5% | 6.25% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 5.7% - 8.0% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 2.6% | 3.1% |
| Equity market risk premium | 7.4% | 8.4% |
| Adjusted beta | 0.59 | 0.8 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.9% | 10.3% |
| Tax rate | 6.0% | 6.5% |
| Debt/Equity ratio | 0.6 | 0.6 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 5.7% | 8.0% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ACE.BK | Absolute Clean Energy PCL | 0.6 | 0.18 | 0.12 |
| BCPG.BK | BCPG PCL | 1.49 | 1.98 | 0.83 |
| CKP.BK | CK Power PCL | 1.54 | 1.49 | 0.61 |
| GUNKUL.BK | Gunkul Engineering PCL | 1.14 | 1.22 | 0.59 |
| PRIME.BK | Prime Road Power PCL | 12.82 | 1.68 | 0.13 |
| SPCG.BK | SPCG PCL | 0 | 0.95 | 0.95 |
| SSP.BK | Sermsang Power Corporation PCL | 2.35 | 0.15 | 0.05 |
| SUPER.BK | Super Energy Corporation PCL | 12.17 | 1.25 | 0.1 |
| TPIPP.BK | TPI Polene Power PCL | 1.52 | 0.78 | 0.32 |
| TSE.BK | Thai Solar Energy PCL | 5.14 | 2.05 | 0.35 |
| Low | High | |
| Unlevered beta | 0.25 | 0.45 |
| Relevered beta | 0.39 | 0.7 |
| Adjusted relevered beta | 0.59 | 0.8 |
ACE.BK'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 ACE.BK:
cost_of_equity (8.60%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.59) + 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.