MCG.VN
Viet Nam Mechanization Electrification and Construction JSC
Price:  
3,000 
VND
Volume:  
1,132,800
Viet Nam | Construction & Engineering

MCG.VN WACC - Weighted Average Cost of Capital

The WACC of Viet Nam Mechanization Electrification and Construction JSC (MCG.VN) is 5.7%.

The Cost of Equity of Viet Nam Mechanization Electrification and Construction JSC (MCG.VN) is 7.05%.
The Cost of Debt of Viet Nam Mechanization Electrification and Construction JSC (MCG.VN) is 5.55%.

RangeSelected
Cost of equity5.1% - 9.0%7.05%
Tax rate0.1% - 0.9%0.5%
Cost of debt5.0% - 6.1%5.55%
WACC5.0% - 6.5%5.7%
WACC

MCG.VN WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium9.5%10.5%
Adjusted beta0.090.35
Additional risk adjustments1.5%2.0%
Cost of equity5.1%9.0%
Tax rate0.1%0.9%
Debt/Equity ratio
5.415.41
Cost of debt5.0%6.1%
After-tax WACC5.0%6.5%
Selected WACC5.7%

MCG.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 MCG.VN:

cost_of_equity (7.05%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.09) + risk_adjustments (1.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.