The WACC of ABM Fujiya Bhd (AFUJIYA.KL) is 9.9%.
Range | Selected | |
Cost of equity | 9.0% - 15.6% | 12.3% |
Tax rate | 31.0% - 37.7% | 34.35% |
Cost of debt | 5.7% - 23.8% | 14.75% |
WACC | 4.8% - 15.0% | 9.9% |
Category | Low | High |
Long-term bond rate | 3.8% | 4.3% |
Equity market risk premium | 6.9% | 7.8% |
Adjusted beta | 0.76 | 1.38 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.0% | 15.6% |
Tax rate | 31.0% | 37.7% |
Debt/Equity ratio | 4.84 | 4.84 |
Cost of debt | 5.7% | 23.8% |
After-tax WACC | 4.8% | 15.0% |
Selected WACC | 9.9% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
AFUJIYA.KL | ABM Fujiya Bhd | 4.84 | 0.56 | 0.14 |
001420.KS | Taewonmulsan Co Ltd | 0 | 0.01 | 0.01 |
541178.BO | Benara Bearings and Pistons Ltd | 2.12 | 1.4 | 0.6 |
APM.KL | APM Automotive Holdings Bhd | 0.52 | 0.64 | 0.48 |
ESAFE.KL | Eversafe Rubber Bhd | 1.51 | -0.11 | -0.06 |
MCEHLDG.KL | Mce Holdings Bhd | 0.09 | 1.03 | 0.97 |
NHFATT.KL | New Hoong Fatt Holdings Bhd | 0 | 0.33 | 0.32 |
PRAS.JK | Prima Alloy Steel Universal Tbk PT | 14.48 | 0.43 | 0.04 |
SAPIND.KL | Sapura Industrial Bhd | 0.78 | 0.26 | 0.17 |
SMISCOR.KL | SMIS Corporation Bhd | 0.27 | 0.86 | 0.74 |
Low | High | |
Unlevered beta | 0.16 | 0.39 |
Relevered beta | 0.64 | 1.57 |
Adjusted relevered beta | 0.76 | 1.38 |
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 AFUJIYA.KL:
cost_of_equity (12.30%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.76) + 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.