V03.SI WACC - Weighted Average Cost of Capital

The WACC of Venture Corporation Ltd (V03.SI) is 7.9%.

The Cost of Equity of Venture Corporation Ltd (V03.SI) is 7.95%.

The Cost of Debt of Venture Corporation Ltd (V03.SI) is 4.25%.

	Range	Selected
Cost of equity	6.90% - 9.00%	7.95%
Tax rate	15.80% - 17.80%	16.80%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.9% - 9.0%	7.9%

WACC

V03.SI WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.83	0.87

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.90%	9.00%

Tax rate	15.80%	17.80%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	4.50%

After-tax WACC	6.9%	9.0%


Selected WACC	7.9%

V03.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 V03.SI:

cost_of_equity (7.95%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.83) + 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.