CJLU.SI
NetLink NBN Trust
Price:  
0.88 
SGD
Volume:  
1,579,300.00
Singapore | Diversified Telecommunication Services
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CJLU.SI WACC - Weighted Average Cost of Capital

The WACC of NetLink NBN Trust (CJLU.SI) is 6.9%.

The Cost of Equity of NetLink NBN Trust (CJLU.SI) is 7.50%.
The Cost of Debt of NetLink NBN Trust (CJLU.SI) is 4.25%.

Range Selected
Cost of equity 6.30% - 8.70% 7.50%
Tax rate 2.90% - 3.50% 3.20%
Cost of debt 4.00% - 4.50% 4.25%
WACC 5.9% - 7.8% 6.9%
WACC

CJLU.SI WACC calculation

Category Low High
Long-term bond rate 2.7% 3.2%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.71 0.81
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.30% 8.70%
Tax rate 2.90% 3.50%
Debt/Equity ratio 0.23 0.23
Cost of debt 4.00% 4.50%
After-tax WACC 5.9% 7.8%
Selected WACC 6.9%

CJLU.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 CJLU.SI:

cost_of_equity (7.50%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.71) + 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.