ASIA.BK WACC - Weighted Average Cost of Capital

The WACC of Asia Hotel PCL (ASIA.BK) is 7.3%.

The Cost of Equity of Asia Hotel PCL (ASIA.BK) is 7.40%.

The Cost of Debt of Asia Hotel PCL (ASIA.BK) is 9.85%.

	Range	Selected
Cost of equity	6.40% - 8.40%	7.40%
Tax rate	14.60% - 30.70%	22.65%
Cost of debt	5.40% - 14.30%	9.85%
WACC	5.4% - 9.3%	7.3%

WACC

ASIA.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.52	0.57

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.40%	8.40%

Tax rate	14.60%	30.70%
Debt/Equity ratio	1.35	1.35
Cost of debt	5.40%	14.30%

After-tax WACC	5.4%	9.3%


Selected WACC	7.3%

ASIA.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 ASIA.BK:

cost_of_equity (7.40%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.52) + 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.