ASTRO.KL WACC - Weighted Average Cost of Capital

The WACC of Astro Malaysia Holdings Bhd (ASTRO.KL) is 8.9%.

The Cost of Equity of Astro Malaysia Holdings Bhd (ASTRO.KL) is 14.60%.

The Cost of Debt of Astro Malaysia Holdings Bhd (ASTRO.KL) is 10.40%.

	Range	Selected
Cost of equity	12.20% - 17.00%	14.60%
Tax rate	25.20% - 27.30%	26.25%
Cost of debt	5.20% - 15.60%	10.40%
WACC	5.4% - 12.4%	8.9%

WACC

ASTRO.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	1.22	1.56

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.20%	17.00%

Tax rate	25.20%	27.30%
Debt/Equity ratio	4.4	4.4
Cost of debt	5.20%	15.60%

After-tax WACC	5.4%	12.4%


Selected WACC	8.9%

ASTRO.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 ASTRO.KL:

cost_of_equity (14.60%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * 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.