MI.KL WACC - Weighted Average Cost of Capital

The WACC of MI Technovation Bhd (MI.KL) is 13.1%.

The Cost of Equity of MI Technovation Bhd (MI.KL) is 13.25%.

The Cost of Debt of MI Technovation Bhd (MI.KL) is 4.25%.

	Range	Selected
Cost of equity	11.00% - 15.50%	13.25%
Tax rate	16.60% - 21.40%	19.00%
Cost of debt	4.00% - 4.50%	4.25%
WACC	10.9% - 15.3%	13.1%

WACC

MI.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	1.06	1.36

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.00%	15.50%

Tax rate	16.60%	21.40%
Debt/Equity ratio	0.02	0.02
Cost of debt	4.00%	4.50%

After-tax WACC	10.9%	15.3%


Selected WACC	13.1%

MI.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 MI.KL:

cost_of_equity (13.25%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (1.06) + 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.