HSG.VN
Hoa Sen Group
Price:  
16.3 
VND
Volume:  
4,881,200
Viet Nam | Metals & Mining

HSG.VN WACC - Weighted Average Cost of Capital

The WACC of Hoa Sen Group (HSG.VN) is 6.5%.

The Cost of Equity of Hoa Sen Group (HSG.VN) is 7.75%.
The Cost of Debt of Hoa Sen Group (HSG.VN) is 5.15%.

RangeSelected
Cost of equity6.8% - 8.7%7.75%
Tax rate14.6% - 23.3%18.95%
Cost of debt4.4% - 5.9%5.15%
WACC5.7% - 7.2%6.5%
WACC

HSG.VN WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium9.5%10.5%
Adjusted beta0.430.47
Additional risk adjustments0.0%0.5%
Cost of equity6.8%8.7%
Tax rate14.6%23.3%
Debt/Equity ratio
0.530.53
Cost of debt4.4%5.9%
After-tax WACC5.7%7.2%
Selected WACC6.5%

HSG.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 HSG.VN:

cost_of_equity (7.75%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.43) + 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.