ACV.SI
Frasers Hospitality Trust
Price:  
0.7 
SGD
Volume:  
17,350,200
Singapore | Equity Real Estate Investment Trusts (REITs)

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%.

RangeSelected
Cost of equity6.3% - 9.0%7.65%
Tax rate13.3% - 22.8%18.05%
Cost of debt4.0% - 5.9%4.95%
WACC5.3% - 7.4%6.3%
WACC

ACV.SI WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium5.1%6.1%
Adjusted beta0.70.87
Additional risk adjustments0.0%0.5%
Cost of equity6.3%9.0%
Tax rate13.3%22.8%
Debt/Equity ratio
0.560.56
Cost of debt4.0%5.9%
After-tax WACC5.3%7.4%
Selected WACC6.3%

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.