KIALIM.KL WACC - Weighted Average Cost of Capital

The WACC of Kia Lim Bhd (KIALIM.KL) is 10.4%.

The Cost of Equity of Kia Lim Bhd (KIALIM.KL) is 10.85%.

The Cost of Debt of Kia Lim Bhd (KIALIM.KL) is 4.80%.

	Range	Selected
Cost of equity	8.80% - 12.90%	10.85%
Tax rate	0.20% - 11.60%	5.90%
Cost of debt	4.40% - 5.20%	4.80%
WACC	8.5% - 12.4%	10.4%

WACC

KIALIM.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.74	1.03

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.80%	12.90%

Tax rate	0.20%	11.60%
Debt/Equity ratio	0.07	0.07
Cost of debt	4.40%	5.20%

After-tax WACC	8.5%	12.4%


Selected WACC	10.4%

KIALIM.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 KIALIM.KL:

cost_of_equity (10.85%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.74) + 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.