The WACC of Saigon Maritime JSC (SHC.VN) is 7.0%.
| Range | Selected | |
| Cost of equity | 8.10% - 12.80% | 10.45% |
| Tax rate | 17.50% - 19.90% | 18.70% |
| Cost of debt | 4.20% - 4.50% | 4.35% |
| WACC | 5.8% - 8.2% | 7.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.56 | 0.86 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.10% | 12.80% |
| Tax rate | 17.50% | 19.90% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 4.20% | 4.50% |
| After-tax WACC | 5.8% | 8.2% |
| Selected WACC | 7.0% | |
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 SHC.VN:
cost_of_equity (10.45%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.56) + 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.