ACV.SI WACC - Weighted Average Cost of Capital

The WACC of Frasers Hospitality Trust (ACV.SI) is 6.3%.

The Cost of Equity of Frasers Hospitality Trust (ACV.SI) is 7.65%.

The Cost of Debt of Frasers Hospitality Trust (ACV.SI) is 4.95%.

	Range	Selected
Cost of equity	6.30% - 9.00%	7.65%
Tax rate	13.30% - 22.80%	18.05%
Cost of debt	4.00% - 5.90%	4.95%
WACC	5.3% - 7.4%	6.3%

WACC

ACV.SI WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.7	0.87

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.30%	9.00%

Tax rate	13.30%	22.80%
Debt/Equity ratio	0.55	0.55
Cost of debt	4.00%	5.90%

After-tax WACC	5.3%	7.4%


Selected WACC	6.3%

ACV.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 ACV.SI:

cost_of_equity (7.65%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.7) + 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.