NQN.VN WACC - Weighted Average Cost of Capital
The WACC of Quangninh Clean Water JSC (NQN.VN) is 6.8%.
| Range | Selected | |
| Cost of equity | 6.9% - 8.8% | 7.85% |
| Tax rate | 19.6% - 19.7% | 19.65% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 5.8% - 7.8% | 6.8% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.44 | 0.48 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.9% | 8.8% |
| Tax rate | 19.6% | 19.7% |
| Debt/Equity ratio | 0.43 | 0.43 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 5.8% | 7.8% |
| Selected WACC | 6.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| NQN.VN | Quangninh Clean Water JSC | 0.43 | -0.16 | -0.12 |
| BSA.VN | Buon Don Hydropower JSC | 0.22 | 0.33 | 0.28 |
| DWS.VN | Dong Thap Water Supply & Urban Environment JSC | 0.29 | 0.11 | 0.09 |
| GHC.VN | Gia Lai Hydropower JSC | 0.27 | 0.36 | 0.3 |
| HDW.VN | Hai Duong Water JSC | 0.49 | 0.04 | 0.03 |
| HPW.VN | Hai Phong Water JSC | 0.62 | 0.2 | 0.13 |
| HWS.VN | Thua Thien Hue Water Supply JSC | 0.46 | 0.16 | 0.12 |
| ND2.VN | North Electrictiy Development and Investment JSC No2 | 0.33 | 0.15 | 0.12 |
| NS2.VN | Hanoi Water Supply Number 2 JSC | 0.58 | 0.32 | 0.22 |
| VAV.VN | Viwaco JSC | 0.06 | 0.38 | 0.36 |
| Low | High | |
| Unlevered beta | 0.12 | 0.17 |
| Relevered beta | 0.16 | 0.22 |
| Adjusted relevered beta | 0.44 | 0.48 |
NQN.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 NQN.VN:
cost_of_equity (7.85%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.44) + 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.