IPTV.JK WACC - Weighted Average Cost of Capital

The WACC of MNC Vision Networks Tbk PT (IPTV.JK) is 10.3%.

The Cost of Equity of MNC Vision Networks Tbk PT (IPTV.JK) is 13.35%.

The Cost of Debt of MNC Vision Networks Tbk PT (IPTV.JK) is 5.85%.

	Range	Selected
Cost of equity	9.50% - 17.20%	13.35%
Tax rate	18.30% - 19.00%	18.65%
Cost of debt	4.00% - 7.70%	5.85%
WACC	7.3% - 13.4%	10.3%

WACC

IPTV.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.36	1.08

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.50%	17.20%

Tax rate	18.30%	19.00%
Debt/Equity ratio	0.54	0.54
Cost of debt	4.00%	7.70%

After-tax WACC	7.3%	13.4%


Selected WACC	10.3%

IPTV.JK'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 IPTV.JK:

cost_of_equity (13.35%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.36) + 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.