The WACC of MCT Bhd (MCT.KL) is 135.8%.
| Range | Selected | |
| Cost of equity | 6.00% - 8.10% | 7.05% |
| Tax rate | 24.00% - 24.00% | 24.00% |
| Cost of debt | 16.70% - 776.60% | 396.65% |
| WACC | 8.9% - 262.7% | 135.8% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 7.3% | 8.3% |
| Adjusted beta | 0.29 | 0.39 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.00% | 8.10% |
| Tax rate | 24.00% | 24.00% |
| Debt/Equity ratio | 0.78 | 0.78 |
| Cost of debt | 16.70% | 776.60% |
| After-tax WACC | 8.9% | 262.7% |
| Selected WACC | 135.8% | |
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 MCT.KL:
cost_of_equity (7.05%) = risk_free_rate (4.15%) + equity_risk_premium (7.80%) * adjusted_beta (0.29) + 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.