HGM.VN WACC - Weighted Average Cost of Capital
The WACC of Ha Giang Mineral and Mechanics JSC (HGM.VN) is 7.2%.
| Range | Selected | |
| Cost of equity | 6.0% - 14.8% | 10.4% |
| Tax rate | 18.6% - 20.5% | 19.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.0% - 9.4% | 7.2% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.34 | 1.05 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.0% | 14.8% |
| Tax rate | 18.6% | 20.5% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.0% | 9.4% |
| Selected WACC | 7.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| HGM.VN | Ha Giang Mineral and Mechanics JSC | 1.17 | 0.55 | 0.29 |
| ALV.VN | Alvico Construction JSC | 0.47 | 0.57 | 0.41 |
| AUL.AX | Austar Gold Ltd | 0.08 | -0.68 | -0.64 |
| BKC.VN | BacKan Mineral Joint Stock Corp | 0.1 | -1.56 | -1.45 |
| KSB.VN | Binh Duong Mineral and Construction JSC | 0.62 | 1.32 | 0.88 |
| MAG.AX | Magmatic Resources Ltd | 0.04 | 1.7 | 1.65 |
| MCT.AX | Metalicity Ltd | 0 | -1.83 | -1.82 |
| MIC.VN | Quang Nam Mineral Industry Corp | 0.33 | -0.5 | -0.39 |
| QEM.AX | QEM Ltd | 0 | 1.16 | 1.16 |
| RDM.AX | Red Metal Ltd | 0.01 | 1.03 | 1.02 |
| TNT.VN | Tai Nguyen Corp | 0.09 | 0.3 | 0.28 |
| Low | High | |
| Unlevered beta | 0.28 | 0.41 |
| Relevered beta | 0.01 | 1.07 |
| Adjusted relevered beta | 0.34 | 1.05 |
HGM.VN'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 HGM.VN:
cost_of_equity (10.40%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.34) + 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.