DPIH.KL WACC - Weighted Average Cost of Capital

The WACC of DPI Holdings Bhd (DPIH.KL) is 10.9%.

The Cost of Equity of DPI Holdings Bhd (DPIH.KL) is 10.90%.

The Cost of Debt of DPI Holdings Bhd (DPIH.KL) is 5.15%.

	Range	Selected
Cost of equity	9.60% - 12.20%	10.90%
Tax rate	28.00% - 29.20%	28.60%
Cost of debt	4.40% - 5.90%	5.15%
WACC	9.6% - 12.2%	10.9%

WACC

DPIH.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.85	0.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.60%	12.20%

Tax rate	28.00%	29.20%
Debt/Equity ratio	0	0
Cost of debt	4.40%	5.90%

After-tax WACC	9.6%	12.2%


Selected WACC	10.9%

DPIH.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 DPIH.KL:

cost_of_equity (10.90%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.85) + 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.