UDC.VN WACC - Weighted Average Cost of Capital
The WACC of Urban Development and Construction Corp (UDC.VN) is 4.9%.
| Range | Selected | |
| Cost of equity | 6.0% - 7.8% | 6.9% |
| Tax rate | 7.6% - 9.4% | 8.5% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.5% - 5.4% | 4.9% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.34 | 0.38 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.0% | 7.8% |
| Tax rate | 7.6% | 9.4% |
| Debt/Equity ratio | 1.87 | 1.87 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.5% | 5.4% |
| Selected WACC | 4.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| UDC.VN | Urban Development and Construction Corp | 1.87 | 4.06 | 1.49 |
| BCE.VN | Binh Duong Construction & Civil Engineering JSC | 0.26 | 0.08 | 0.07 |
| DC4.VN | DIC Holdings Construction JSC | 0.28 | 1.53 | 1.21 |
| DIH.VN | Development Investment Construction Hoi An JSC | 3.97 | 0.18 | 0.04 |
| HU1.VN | HUD1 Investment and Construction JSC | 5.09 | 0.62 | 0.11 |
| MDG.VN | Mien Dong JSC | 0.64 | -0.4 | -0.26 |
| PTD.VN | Phuc Thinh Design Construction Trading Corp | 4.17 | -1.48 | -0.31 |
| S55.VN | Song Da 505 JSC | 1.69 | -0.03 | -0.01 |
| VC1.VN | Construction JSC N0 1 | 1.39 | 0.05 | 0.02 |
| Low | High | |
| Unlevered beta | 0.03 | 0.06 |
| Relevered beta | 0.01 | 0.07 |
| Adjusted relevered beta | 0.34 | 0.38 |
UDC.VN'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 UDC.VN:
cost_of_equity (6.90%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.34) + 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.