The WACC of Masan Group Corp (MSN.VN) is 12.0%.
| Range | Selected | |
| Cost of equity | 12.40% - 15.80% | 14.10% |
| Tax rate | 21.10% - 27.90% | 24.50% |
| Cost of debt | 9.50% - 14.50% | 12.00% |
| WACC | 10.4% - 13.6% | 12.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 1.02 | 1.15 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 12.40% | 15.80% |
| Tax rate | 21.10% | 27.90% |
| Debt/Equity ratio | 0.71 | 0.71 |
| Cost of debt | 9.50% | 14.50% |
| After-tax WACC | 10.4% | 13.6% |
| Selected WACC | 12.0% | |
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 MSN.VN:
cost_of_equity (14.10%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (1.02) + 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.