BREM.KL WACC - Weighted Average Cost of Capital

The WACC of Brem Holding Bhd (BREM.KL) is 7.4%.

The Cost of Equity of Brem Holding Bhd (BREM.KL) is 8.35%.

The Cost of Debt of Brem Holding Bhd (BREM.KL) is 4.45%.

	Range	Selected
Cost of equity	6.90% - 9.80%	8.35%
Tax rate	30.90% - 34.40%	32.65%
Cost of debt	4.00% - 4.90%	4.45%
WACC	6.2% - 8.7%	7.4%

WACC

BREM.KL WACC calculation

Category	Low	High

Long-term bond rate	4.2%	4.7%
Equity market risk premium	5.9%	6.9%
Adjusted beta	0.45	0.66

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.90%	9.80%

Tax rate	30.90%	34.40%
Debt/Equity ratio	0.21	0.21
Cost of debt	4.00%	4.90%

After-tax WACC	6.2%	8.7%


Selected WACC	7.4%

BREM.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 BREM.KL:

cost_of_equity (8.35%) = risk_free_rate (4.45%) + equity_risk_premium (6.40%) * 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.