MKNT.JK WACC - Weighted Average Cost of Capital

The WACC of Mitra Komunikasi Nusantara Tbk PT (MKNT.JK) is 5.7%.

The Cost of Equity of Mitra Komunikasi Nusantara Tbk PT (MKNT.JK) is 32.35%.

The Cost of Debt of Mitra Komunikasi Nusantara Tbk PT (MKNT.JK) is 5.50%.

	Range	Selected
Cost of equity	18.80% - 45.90%	32.35%
Tax rate	11.80% - 14.30%	13.05%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.0% - 7.3%	5.7%

WACC

MKNT.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	1.54	4.31

Additional risk adjustments	0.0%	0.5%
Cost of equity	18.80%	45.90%

Tax rate	11.80%	14.30%
Debt/Equity ratio	28.63	28.63
Cost of debt	4.00%	7.00%

After-tax WACC	4.0%	7.3%


Selected WACC	5.7%

MKNT.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 MKNT.JK:

cost_of_equity (32.35%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (1.54) + 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.