BCMALL.KL WACC - Weighted Average Cost of Capital

The WACC of Bcm Alliance Bhd (BCMALL.KL) is 9.2%.

The Cost of Equity of Bcm Alliance Bhd (BCMALL.KL) is 11.35%.

The Cost of Debt of Bcm Alliance Bhd (BCMALL.KL) is 6.20%.

	Range	Selected
Cost of equity	9.80% - 12.90%	11.35%
Tax rate	17.20% - 24.60%	20.90%
Cost of debt	5.40% - 7.00%	6.20%
WACC	8.1% - 10.4%	9.2%

WACC

BCMALL.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.88	1.03

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.80%	12.90%

Tax rate	17.20%	24.60%
Debt/Equity ratio	0.48	0.48
Cost of debt	5.40%	7.00%

After-tax WACC	8.1%	10.4%


Selected WACC	9.2%

BCMALL.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 BCMALL.KL:

cost_of_equity (11.35%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.88) + 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.