CEPCO.KL WACC - Weighted Average Cost of Capital

The WACC of Concrete Engineering Products Bhd (CEPCO.KL) is 9.7%.

The Cost of Equity of Concrete Engineering Products Bhd (CEPCO.KL) is 10.50%.

The Cost of Debt of Concrete Engineering Products Bhd (CEPCO.KL) is 4.75%.

	Range	Selected
Cost of equity	9.00% - 12.00%	10.50%
Tax rate	0.10% - 2.70%	1.40%
Cost of debt	4.40% - 5.10%	4.75%
WACC	8.4% - 11.1%	9.7%

WACC

CEPCO.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	0.92

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.00%	12.00%

Tax rate	0.10%	2.70%
Debt/Equity ratio	0.15	0.15
Cost of debt	4.40%	5.10%

After-tax WACC	8.4%	11.1%


Selected WACC	9.7%

CEPCO.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 CEPCO.KL:

cost_of_equity (10.50%) = 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.