TS0U.SI WACC - Weighted Average Cost of Capital
The WACC of Oue Commercial Real Estate Investment Trust (TS0U.SI) is 6.0%.
| Range | Selected | |
| Cost of equity | 6.4% - 8.7% | 7.55% |
| Tax rate | 2.7% - 10.3% | 6.5% |
| Cost of debt | 4.0% - 6.3% | 5.15% |
| WACC | 5.0% - 7.0% | 6.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.73 | 0.82 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.4% | 8.7% |
| Tax rate | 2.7% | 10.3% |
| Debt/Equity ratio | 1.28 | 1.28 |
| Cost of debt | 4.0% | 6.3% |
| After-tax WACC | 5.0% | 7.0% |
| Selected WACC | 6.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TS0U.SI | Oue Commercial Real Estate Investment Trust | 1.28 | 0.6 | 0.27 |
| 3296.T | Nippon REIT Investment Corp | 0.84 | 0.28 | 0.15 |
| 8956.T | Premier Investment Corp | 0.78 | 0.25 | 0.14 |
| 8957.T | Tokyu REIT Inc | 0.58 | 0.41 | 0.27 |
| ABP.AX | Abacus Property Group | 0.96 | 0.86 | 0.45 |
| AU8U.SI | CapitaLand China Trust | 1.48 | 0.84 | 0.35 |
| CNNU.SI | Cromwell European Real Estate Investment Trust | 0.63 | 0.64 | 0.4 |
| RW0U.SI | Mapletree North Asia Commercial Trust | 0.8 | 0.97 | 0.55 |
| SK6U.SI | SPH REIT | 0.55 | 0.09 | 0.06 |
| T82U.SI | Suntec Real Estate Investment Trust | 1.27 | 0.69 | 0.31 |
| Low | High | |
| Unlevered beta | 0.27 | 0.33 |
| Relevered beta | 0.6 | 0.73 |
| Adjusted relevered beta | 0.73 | 0.82 |
TS0U.SI'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 TS0U.SI:
cost_of_equity (7.55%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.73) + 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.