JTIASA.KL WACC - Weighted Average Cost of Capital

The WACC of Jaya Tiasa Holdings Bhd (JTIASA.KL) is 9.8%.

The Cost of Equity of Jaya Tiasa Holdings Bhd (JTIASA.KL) is 10.95%.

The Cost of Debt of Jaya Tiasa Holdings Bhd (JTIASA.KL) is 4.45%.

	Range	Selected
Cost of equity	9.60% - 12.30%	10.95%
Tax rate	34.60% - 39.10%	36.85%
Cost of debt	4.40% - 4.50%	4.45%
WACC	8.6% - 10.9%	9.8%

WACC

JTIASA.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.85	0.96

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.60%	12.30%

Tax rate	34.60%	39.10%
Debt/Equity ratio	0.17	0.17
Cost of debt	4.40%	4.50%

After-tax WACC	8.6%	10.9%


Selected WACC	9.8%

JTIASA.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 JTIASA.KL:

cost_of_equity (10.95%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.85) + 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.