ACME.KL WACC - Weighted Average Cost of Capital

The WACC of ACME Holdings Bhd (ACME.KL) is 5.6%.

The Cost of Equity of ACME Holdings Bhd (ACME.KL) is 6.90%.

The Cost of Debt of ACME Holdings Bhd (ACME.KL) is 5.45%.

	Range	Selected
Cost of equity	5.70% - 8.10%	6.90%
Tax rate	26.80% - 28.50%	27.65%
Cost of debt	4.40% - 6.50%	5.45%
WACC	4.6% - 6.6%	5.6%

WACC

ACME.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.28	0.43

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.70%	8.10%

Tax rate	26.80%	28.50%
Debt/Equity ratio	0.8	0.8
Cost of debt	4.40%	6.50%

After-tax WACC	4.6%	6.6%


Selected WACC	5.6%

ACME.KL'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 ACME.KL:

cost_of_equity (6.90%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.28) + 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.