EPMB.KL WACC - Weighted Average Cost of Capital

The WACC of Ep Manufacturing Bhd (EPMB.KL) is 8.4%.

The Cost of Equity of Ep Manufacturing Bhd (EPMB.KL) is 14.35%.

The Cost of Debt of Ep Manufacturing Bhd (EPMB.KL) is 6.45%.

	Range	Selected
Cost of equity	11.40% - 17.30%	14.35%
Tax rate	31.20% - 32.20%	31.70%
Cost of debt	6.00% - 6.90%	6.45%
WACC	7.1% - 9.8%	8.4%

WACC

EPMB.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	1.12	1.6

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.40%	17.30%

Tax rate	31.20%	32.20%
Debt/Equity ratio	1.49	1.49
Cost of debt	6.00%	6.90%

After-tax WACC	7.1%	9.8%


Selected WACC	8.4%

EPMB.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 EPMB.KL:

cost_of_equity (14.35%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (1.12) + 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.