The WACC of Siam Future Development PCL (SF.BK) is 7.3%.
Range | Selected | |
Cost of equity | 6.2% - 10.9% | 8.55% |
Tax rate | 6.1% - 7.6% | 6.85% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 5.5% - 9.1% | 7.3% |
Category | Low | High |
Long-term bond rate | 2.6% | 3.1% |
Equity market risk premium | 7.4% | 8.4% |
Adjusted beta | 0.48 | 0.87 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.2% | 10.9% |
Tax rate | 6.1% | 7.6% |
Debt/Equity ratio | 0.36 | 0.36 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 5.5% | 9.1% |
Selected WACC | 7.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
SF.BK | Siam Future Development PCL | 0.36 | 1.2 | 0.9 |
108.HK | GR Properties Ltd | 1.19 | 1.87 | 0.88 |
266.HK | Tian Teck Land Ltd | 0.2 | -0.03 | -0.03 |
3603.HK | Xinji Shaxi Group Co Ltd | 18.02 | 0.74 | 0.04 |
715.HK | China Oceanwide Holdings Ltd | 29.51 | 1.07 | 0.04 |
8842.T | Tokyo Rakutenchi Co Ltd | 0.07 | -0.6 | -0.56 |
BLAND.BK | Bangkok Land PCL | 0.48 | 1.35 | 0.93 |
J.BK | JAS Asset PCL | 2.14 | 1.26 | 0.42 |
MBK.BK | MBK PCL | 1.4 | 0.6 | 0.26 |
WIN.BK | Wyncoast Industrial Park PCL | 0.5 | 1.47 | 1.01 |
Low | High | |
Unlevered beta | 0.17 | 0.61 |
Relevered beta | 0.22 | 0.81 |
Adjusted relevered beta | 0.48 | 0.87 |
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 SF.BK:
cost_of_equity (8.55%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.48) + 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.