The WACC of FPT Securities JSC (FTS.VN) is 10.4%.
Range | Selected | |
Cost of equity | 9.9% - 13.7% | 11.8% |
Tax rate | 15.1% - 16.7% | 15.9% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 8.9% - 11.9% | 10.4% |
Category | Low | High |
Long-term bond rate | 3.3% | 3.8% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 0.8 | 1.01 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.9% | 13.7% |
Tax rate | 15.1% | 16.7% |
Debt/Equity ratio | 0.23 | 0.23 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 8.9% | 11.9% |
Selected WACC | 10.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
FTS.VN | FPT Securities JSC | 0.23 | 1.48 | 1.24 |
AGR.VN | Agribank Securities Joint-Stock Corp | 0.27 | 1.5 | 1.22 |
BVS.VN | Bao Viet Securities JSC | 1.22 | 1.66 | 0.82 |
CTS.VN | VietinBank Securities JSC | 1.25 | 1.53 | 0.75 |
EVS.VN | Everest Securities JSC | 0.46 | 1.48 | 1.07 |
ORS.VN | Tien Phong Securities Corporation | 2.28 | 1.22 | 0.42 |
SHS.VN | Saigon Hanoi Securities JSC | 0.18 | 1.45 | 1.26 |
TVS.VN | Thien Viet Securities JSC | 1.58 | 1.35 | 0.58 |
VDS.VN | Viet Dragon Securities Corp | 0.98 | 1.78 | 0.98 |
VIG.VN | Viet Nam Industrial & Commercial Securities Co | 1.02 | 0.99 | 0.53 |
Low | High | |
Unlevered beta | 0.79 | 1.02 |
Relevered beta | 0.7 | 1.01 |
Adjusted relevered beta | 0.8 | 1.01 |
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 FTS.VN:
cost_of_equity (11.80%) = risk_free_rate (3.55%) + equity_risk_premium (8.80%) * adjusted_beta (0.8) + 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.