CARIMIN.KL WACC - Weighted Average Cost of Capital

The WACC of Carimin Petroleum Bhd (CARIMIN.KL) is 9.7%.

The Cost of Equity of Carimin Petroleum Bhd (CARIMIN.KL) is 10.10%.

The Cost of Debt of Carimin Petroleum Bhd (CARIMIN.KL) is 6.85%.

	Range	Selected
Cost of equity	9.00% - 11.20%	10.10%
Tax rate	25.30% - 33.60%	29.45%
Cost of debt	4.40% - 9.30%	6.85%
WACC	8.6% - 10.9%	9.7%

WACC

CARIMIN.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.76	0.81

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.00%	11.20%

Tax rate	25.30%	33.60%
Debt/Equity ratio	0.07	0.07
Cost of debt	4.40%	9.30%

After-tax WACC	8.6%	10.9%


Selected WACC	9.7%

CARIMIN.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 CARIMIN.KL:

cost_of_equity (10.10%) = 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.