The WACC of Vinaconex 25 JSC (VCC.VN) is 10.1%.
| Range | Selected | |
| Cost of equity | 8.70% - 11.30% | 10.00% |
| Tax rate | 31.00% - 33.50% | 32.25% |
| Cost of debt | 10.70% - 19.70% | 15.20% |
| WACC | 8.0% - 12.3% | 10.1% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.63 | 0.72 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.70% | 11.30% |
| Tax rate | 31.00% | 33.50% |
| Debt/Equity ratio | 1.26 | 1.26 |
| Cost of debt | 10.70% | 19.70% |
| After-tax WACC | 8.0% | 12.3% |
| Selected WACC | 10.1% | |
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 VCC.VN:
cost_of_equity (10.00%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.63) + 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.