IVORY.KL WACC - Weighted Average Cost of Capital

The WACC of Ivory Properties Group Bhd (IVORY.KL) is 5.8%.

The Cost of Equity of Ivory Properties Group Bhd (IVORY.KL) is 10.10%.

The Cost of Debt of Ivory Properties Group Bhd (IVORY.KL) is 5.35%.

	Range	Selected
Cost of equity	6.80% - 13.40%	10.10%
Tax rate	3.10% - 4.90%	4.00%
Cost of debt	4.90% - 5.80%	5.35%
WACC	5.0% - 6.6%	5.8%

WACC

IVORY.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.44	1.1

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.80%	13.40%

Tax rate	3.10%	4.90%
Debt/Equity ratio	6.78	6.78
Cost of debt	4.90%	5.80%

After-tax WACC	5.0%	6.6%


Selected WACC	5.8%

IVORY.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 IVORY.KL:

cost_of_equity (10.10%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.44) + 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.