ICTZONE.KL WACC - Weighted Average Cost of Capital

The WACC of ICT Zone Asia Bhd (ICTZONE.KL) is 7.9%.

The Cost of Equity of ICT Zone Asia Bhd (ICTZONE.KL) is 10.65%.

The Cost of Debt of ICT Zone Asia Bhd (ICTZONE.KL) is 5.95%.

	Range	Selected
Cost of equity	8.60% - 12.70%	10.65%
Tax rate	27.40% - 31.40%	29.40%
Cost of debt	5.50% - 6.40%	5.95%
WACC	6.6% - 9.1%	7.9%

WACC

ICTZONE.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.71	1.01

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.60%	12.70%

Tax rate	27.40%	31.40%
Debt/Equity ratio	0.77	0.77
Cost of debt	5.50%	6.40%

After-tax WACC	6.6%	9.1%


Selected WACC	7.9%

ICTZONE.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 ICTZONE.KL:

cost_of_equity (10.65%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.71) + 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.