B58.SI WACC - Weighted Average Cost of Capital

The WACC of Banyan Tree Holdings Ltd (B58.SI) is 5.5%.

The Cost of Equity of Banyan Tree Holdings Ltd (B58.SI) is 6.65%.

The Cost of Debt of Banyan Tree Holdings Ltd (B58.SI) is 5.60%.

	Range	Selected
Cost of equity	5.60% - 7.70%	6.65%
Tax rate	15.10% - 20.10%	17.60%
Cost of debt	4.90% - 6.30%	5.60%
WACC	4.7% - 6.2%	5.5%

WACC

B58.SI WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.56	0.66

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.60%	7.70%

Tax rate	15.10%	20.10%
Debt/Equity ratio	1.41	1.41
Cost of debt	4.90%	6.30%

After-tax WACC	4.7%	6.2%


Selected WACC	5.5%

B58.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 B58.SI:

cost_of_equity (6.65%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.56) + 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.