DIALOG.KL WACC - Weighted Average Cost of Capital

The WACC of Dialog Group Bhd (DIALOG.KL) is 9.6%.

The Cost of Equity of Dialog Group Bhd (DIALOG.KL) is 10.25%.

The Cost of Debt of Dialog Group Bhd (DIALOG.KL) is 6.50%.

	Range	Selected
Cost of equity	8.80% - 11.70%	10.25%
Tax rate	8.50% - 9.60%	9.05%
Cost of debt	4.00% - 9.00%	6.50%
WACC	8.0% - 11.1%	9.6%

WACC

DIALOG.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.74	0.89

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.80%	11.70%

Tax rate	8.50%	9.60%
Debt/Equity ratio	0.2	0.2
Cost of debt	4.00%	9.00%

After-tax WACC	8.0%	11.1%


Selected WACC	9.6%

DIALOG.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 DIALOG.KL:

cost_of_equity (10.25%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.74) + 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.