G20.SI WACC - Weighted Average Cost of Capital

The WACC of GP Industries Ltd (G20.SI) is 7.3%.

The Cost of Equity of GP Industries Ltd (G20.SI) is 12.25%.

The Cost of Debt of GP Industries Ltd (G20.SI) is 5.60%.

	Range	Selected
Cost of equity	8.90% - 15.60%	12.25%
Tax rate	17.60% - 22.20%	19.90%
Cost of debt	4.90% - 6.30%	5.60%
WACC	5.8% - 8.8%	7.3%

WACC

G20.SI WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	1.22	1.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.90%	15.60%

Tax rate	17.60%	22.20%
Debt/Equity ratio	1.72	1.72
Cost of debt	4.90%	6.30%

After-tax WACC	5.8%	8.8%


Selected WACC	7.3%

G20.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 G20.SI:

cost_of_equity (12.25%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (1.22) + 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.