The WACC of Ipa Investments Group JSC (IPA.VN) is 9.5%.
Range | Selected | |
Cost of equity | 7.5% - 14.5% | 11% |
Tax rate | 6.4% - 9.8% | 8.1% |
Cost of debt | 8.0% - 9.8% | 8.9% |
WACC | 7.5% - 11.5% | 9.5% |
Category | Low | High |
Long-term bond rate | 2.7% | 3.2% |
Equity market risk premium | 9.5% | 10.5% |
Adjusted beta | 0.5 | 1.03 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.5% | 14.5% |
Tax rate | 6.4% | 9.8% |
Debt/Equity ratio | 1.18 | 1.18 |
Cost of debt | 8.0% | 9.8% |
After-tax WACC | 7.5% | 11.5% |
Selected WACC | 9.5% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
IPA.VN | Ipa Investments Group JSC | 1.18 | 1.11 | 0.54 |
HAF.VN | Hanoi Foodstuff JSC | 0.24 | -0.39 | -0.32 |
HTM.VN | Hanoi Trade Joint Stock Corp | 0.28 | 0.63 | 0.5 |
ITS.VN | Vinacomin Investment, Trading And Service JSC | 7.43 | 0.63 | 0.08 |
PVM.VN | Petrovietnam Machinery Technology JSC | 0.55 | 0.95 | 0.63 |
SWC.VN | Southern Waterborne Transport Corp | 0.05 | 0.53 | 0.51 |
TDG.VN | Thai Duong Petrol JSC | 6.19 | 0.99 | 0.15 |
VNP.VN | Vietnam Plastic Corp | 0.16 | 1.61 | 1.4 |
Low | High | |
Unlevered beta | 0.43 | 0.51 |
Relevered beta | 0.25 | 1.04 |
Adjusted relevered beta | 0.5 | 1.03 |
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 IPA.VN:
cost_of_equity (11.00%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.5) + 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.