GREATEC.KL WACC - Weighted Average Cost of Capital

The WACC of Greatech Technology Bhd (GREATEC.KL) is 13.9%.

The Cost of Equity of Greatech Technology Bhd (GREATEC.KL) is 13.90%.

The Cost of Debt of Greatech Technology Bhd (GREATEC.KL) is 4.25%.

	Range	Selected
Cost of equity	11.60% - 16.20%	13.90%
Tax rate	2.90% - 4.70%	3.80%
Cost of debt	4.00% - 4.50%	4.25%
WACC	11.6% - 16.1%	13.9%

WACC

GREATEC.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	1.14	1.45

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.60%	16.20%

Tax rate	2.90%	4.70%
Debt/Equity ratio	0	0
Cost of debt	4.00%	4.50%

After-tax WACC	11.6%	16.1%


Selected WACC	13.9%

GREATEC.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 GREATEC.KL:

cost_of_equity (13.90%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (1.14) + 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.