FOCUSP.KL WACC - Weighted Average Cost of Capital

The WACC of Focus Point Holdings Bhd (FOCUSP.KL) is 8.7%.

The Cost of Equity of Focus Point Holdings Bhd (FOCUSP.KL) is 10.70%.

The Cost of Debt of Focus Point Holdings Bhd (FOCUSP.KL) is 4.35%.

	Range	Selected
Cost of equity	9.20% - 12.20%	10.70%
Tax rate	24.80% - 27.80%	26.30%
Cost of debt	4.00% - 4.70%	4.35%
WACC	7.5% - 9.9%	8.7%

WACC

FOCUSP.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.79	0.95

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.20%	12.20%

Tax rate	24.80%	27.80%
Debt/Equity ratio	0.37	0.37
Cost of debt	4.00%	4.70%

After-tax WACC	7.5%	9.9%


Selected WACC	8.7%

FOCUSP.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 FOCUSP.KL:

cost_of_equity (10.70%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.79) + 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.