SHG.WA WACC - Weighted Average Cost of Capital

The WACC of Starhedge SA (SHG.WA) is 8.7%.

The Cost of Equity of Starhedge SA (SHG.WA) is 9.80%.

The Cost of Debt of Starhedge SA (SHG.WA) is 6.00%.

	Range	Selected
Cost of equity	8.60% - 11.00%	9.80%
Tax rate	11.50% - 14.00%	12.75%
Cost of debt	5.80% - 6.20%	6.00%
WACC	7.8% - 9.6%	8.7%

WACC

SHG.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.49	0.61

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.60%	11.00%

Tax rate	11.50%	14.00%
Debt/Equity ratio	0.32	0.32
Cost of debt	5.80%	6.20%

After-tax WACC	7.8%	9.6%


Selected WACC	8.7%

SHG.WA'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 SHG.WA:

cost_of_equity (9.80%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.49) + 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.