The WACC of Daya Materials Bhd (DAYA.KL) is 8.1%.
| Range | Selected | |
| Cost of equity | 54.30% - 102.80% | 78.55% |
| Tax rate | 4.60% - 20.00% | 12.30% |
| Cost of debt | 4.10% - 7.00% | 5.55% |
| WACC | 6.2% - 10.0% | 8.1% |
| Category | Low | High |
| Long-term bond rate | 4.2% | 4.7% |
| Equity market risk premium | 5.9% | 6.9% |
| Adjusted beta | 8.44 | 14.08 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 54.30% | 102.80% |
| Tax rate | 4.60% | 20.00% |
| Debt/Equity ratio | 20.96 | 20.96 |
| Cost of debt | 4.10% | 7.00% |
| After-tax WACC | 6.2% | 10.0% |
| Selected WACC | 8.1% | |
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 DAYA.KL:
cost_of_equity (78.55%) = risk_free_rate (4.45%) + equity_risk_premium (6.40%) * adjusted_beta (8.44) + 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.