PVM.VN WACC - Weighted Average Cost of Capital
The WACC of Petrovietnam Machinery Technology JSC (PVM.VN) is 9.0%.
| Range | Selected | |
| Cost of equity | 7.0% - 9.9% | 8.45% |
| Tax rate | 2.6% - 5.2% | 3.9% |
| Cost of debt | 7.0% - 14.0% | 10.5% |
| WACC | 6.9% - 11.1% | 9.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.45 | 0.58 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.0% | 9.9% |
| Tax rate | 2.6% | 5.2% |
| Debt/Equity ratio | 0.55 | 0.55 |
| Cost of debt | 7.0% | 14.0% |
| After-tax WACC | 6.9% | 11.1% |
| Selected WACC | 9.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PVM.VN | Petrovietnam Machinery Technology JSC | 0.55 | 0.95 | 0.62 |
| HAF.VN | Hanoi Foodstuff JSC | 0.24 | -0.39 | -0.32 |
| ITS.VN | Vinacomin Investment, Trading And Service JSC | 7.43 | 0.63 | 0.08 |
| MEL.VN | Me Lin Steel JSC | 4.47 | 1.02 | 0.19 |
| SWC.VN | Southern Waterborne Transport Corp | 0.05 | 0.53 | 0.51 |
| TDG.VN | Thai Duong Petrol JSC | 6.19 | 0.99 | 0.14 |
| TNI.VN | Thanh Nam Group JSC | 2.73 | 1.18 | 0.32 |
| Low | High | |
| Unlevered beta | 0.16 | 0.27 |
| Relevered beta | 0.18 | 0.37 |
| Adjusted relevered beta | 0.45 | 0.58 |
PVM.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 PVM.VN:
cost_of_equity (8.45%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.45) + 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.