DPHARMA.KL WACC - Weighted Average Cost of Capital

The WACC of Duopharma Biotech Bhd (DPHARMA.KL) is 10.1%.

The Cost of Equity of Duopharma Biotech Bhd (DPHARMA.KL) is 12.85%.

The Cost of Debt of Duopharma Biotech Bhd (DPHARMA.KL) is 5.45%.

	Range	Selected
Cost of equity	11.20% - 14.50%	12.85%
Tax rate	19.50% - 21.20%	20.35%
Cost of debt	5.40% - 5.50%	5.45%
WACC	9.0% - 11.2%	10.1%

WACC

DPHARMA.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	1.08	1.23

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.20%	14.50%

Tax rate	19.50%	21.20%
Debt/Equity ratio	0.47	0.47
Cost of debt	5.40%	5.50%

After-tax WACC	9.0%	11.2%


Selected WACC	10.1%

DPHARMA.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 DPHARMA.KL:

cost_of_equity (12.85%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (1.08) + 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.