BPURI.KL WACC - Weighted Average Cost of Capital

The WACC of Bina Puri Holdings Bhd (BPURI.KL) is 7.9%.

The Cost of Equity of Bina Puri Holdings Bhd (BPURI.KL) is 9.25%.

The Cost of Debt of Bina Puri Holdings Bhd (BPURI.KL) is 8.55%.

	Range	Selected
Cost of equity	6.90% - 11.60%	9.25%
Tax rate	8.30% - 25.90%	17.10%
Cost of debt	8.10% - 9.00%	8.55%
WACC	7.2% - 8.7%	7.9%

WACC

BPURI.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.45	0.87

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.90%	11.60%

Tax rate	8.30%	25.90%
Debt/Equity ratio	1.47	1.47
Cost of debt	8.10%	9.00%

After-tax WACC	7.2%	8.7%


Selected WACC	7.9%

BPURI.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 BPURI.KL:

cost_of_equity (9.25%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.45) + 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.