MDLN.JK WACC - Weighted Average Cost of Capital

The WACC of Modernland Realty Tbk PT (MDLN.JK) is 14.1%.

The Cost of Equity of Modernland Realty Tbk PT (MDLN.JK) is 18.05%.

The Cost of Debt of Modernland Realty Tbk PT (MDLN.JK) is 15.30%.

	Range	Selected
Cost of equity	11.30% - 24.80%	18.05%
Tax rate	2.30% - 11.50%	6.90%
Cost of debt	4.00% - 26.60%	15.30%
WACC	4.6% - 23.7%	14.1%

WACC

MDLN.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.59	1.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.30%	24.80%

Tax rate	2.30%	11.50%
Debt/Equity ratio	10.27	10.27
Cost of debt	4.00%	26.60%

After-tax WACC	4.6%	23.7%


Selected WACC	14.1%

MDLN.JK'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 MDLN.JK:

cost_of_equity (18.05%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.59) + 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.