U10.SI
UOB-Kay Hian Holdings Ltd
Price:  
2.13 
SGD
Volume:  
782,400
Singapore | Capital Markets

U10.SI WACC - Weighted Average Cost of Capital

The WACC of UOB-Kay Hian Holdings Ltd (U10.SI) is 5.7%.

The Cost of Equity of UOB-Kay Hian Holdings Ltd (U10.SI) is 6.5%.
The Cost of Debt of UOB-Kay Hian Holdings Ltd (U10.SI) is 4.25%.

RangeSelected
Cost of equity5.6% - 7.4%6.5%
Tax rate11.9% - 12.4%12.15%
Cost of debt4.0% - 4.5%4.25%
WACC5.0% - 6.4%5.7%
WACC

U10.SI WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium5.1%6.1%
Adjusted beta0.570.6
Additional risk adjustments0.0%0.5%
Cost of equity5.6%7.4%
Tax rate11.9%12.4%
Debt/Equity ratio
0.410.41
Cost of debt4.0%4.5%
After-tax WACC5.0%6.4%
Selected WACC5.7%

U10.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 U10.SI:

cost_of_equity (6.50%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.57) + 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.