INNO.KL WACC - Weighted Average Cost of Capital
The WACC of Innoprise Plantations Bhd (INNO.KL) is 9.4%.
| Range | Selected | |
| Cost of equity | 8.4% - 10.5% | 9.45% |
| Tax rate | 23.7% - 24.0% | 23.85% |
| Cost of debt | 4.4% - 7.3% | 5.85% |
| WACC | 8.4% - 10.5% | 9.4% |
| Category | Low | High |
| Long-term bond rate | 3.8% | 4.3% |
| Equity market risk premium | 6.9% | 7.8% |
| Adjusted beta | 0.67 | 0.73 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.4% | 10.5% |
| Tax rate | 23.7% | 24.0% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 4.4% | 7.3% |
| After-tax WACC | 8.4% | 10.5% |
| Selected WACC | 9.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| INNO.KL | Innoprise Plantations Bhd | 0 | 0.53 | 0.53 |
| CEPAT.KL | Cepatwawasan Group Bhd | 0.28 | 0.57 | 0.47 |
| GOCEAN.KL | Green Ocean Corporation Bhd | 0.33 | 0.29 | 0.23 |
| HARNLEN.KL | Harn Len Corporation Bhd | 0.16 | 1 | 0.89 |
| KAWAN.KL | Kawan Food Bhd | 0.01 | 0.68 | 0.67 |
| KMLOONG.KL | Kim Loong Resources Bhd | 0.07 | 0.57 | 0.54 |
| KRETAM.KL | Kretam Holdings Bhd | 0.06 | 0.03 | 0.03 |
| LOTUS.KL | Lotus KFM Bhd | 0.05 | 0.92 | 0.89 |
| SDS.KL | SDS Group Bhd | 0.05 | 1.08 | 1.04 |
| THPLANT.KL | TH Plantations Bhd | 1.97 | 1.1 | 0.44 |
| Low | High | |
| Unlevered beta | 0.51 | 0.6 |
| Relevered beta | 0.51 | 0.6 |
| Adjusted relevered beta | 0.67 | 0.73 |
INNO.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 INNO.KL:
cost_of_equity (9.45%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.67) + 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.