MALAKOF.KL WACC - Weighted Average Cost of Capital

The WACC of Malakoff Corporation Bhd (MALAKOF.KL) is 8.5%.

The Cost of Equity of Malakoff Corporation Bhd (MALAKOF.KL) is 12.35%.

The Cost of Debt of Malakoff Corporation Bhd (MALAKOF.KL) is 9.45%.

	Range	Selected
Cost of equity	10.70% - 14.00%	12.35%
Tax rate	29.60% - 33.40%	31.50%
Cost of debt	6.60% - 12.30%	9.45%
WACC	6.7% - 10.2%	8.5%

WACC

MALAKOF.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	1.01	1.17

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.70%	14.00%

Tax rate	29.60%	33.40%
Debt/Equity ratio	1.89	1.89
Cost of debt	6.60%	12.30%

After-tax WACC	6.7%	10.2%


Selected WACC	8.5%

MALAKOF.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 MALAKOF.KL:

cost_of_equity (12.35%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (1.01) + 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.