HEXZA.KL WACC - Weighted Average Cost of Capital

The WACC of Hexza Corporation Bhd (HEXZA.KL) is 6.8%.

The Cost of Equity of Hexza Corporation Bhd (HEXZA.KL) is 6.85%.

The Cost of Debt of Hexza Corporation Bhd (HEXZA.KL) is 4.45%.

	Range	Selected
Cost of equity	6.10% - 7.60%	6.85%
Tax rate	15.40% - 22.80%	19.10%
Cost of debt	4.40% - 4.50%	4.45%
WACC	6.1% - 7.6%	6.8%

WACC

HEXZA.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.34	0.36

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.10%	7.60%

Tax rate	15.40%	22.80%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.40%	4.50%

After-tax WACC	6.1%	7.6%


Selected WACC	6.8%

HEXZA.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 HEXZA.KL:

cost_of_equity (6.85%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.34) + 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.