ML.BK WACC - Weighted Average Cost of Capital

The WACC of Mida Leasing PCL (ML.BK) is 6.4%.

The Cost of Equity of Mida Leasing PCL (ML.BK) is 9.85%.

The Cost of Debt of Mida Leasing PCL (ML.BK) is 6.80%.

	Range	Selected
Cost of equity	6.90% - 12.80%	9.85%
Tax rate	20.80% - 20.90%	20.85%
Cost of debt	6.60% - 7.00%	6.80%
WACC	5.6% - 7.3%	6.4%

WACC

ML.BK WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.58	1.1

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.90%	12.80%

Tax rate	20.80%	20.90%
Debt/Equity ratio	3.16	3.16
Cost of debt	6.60%	7.00%

After-tax WACC	5.6%	7.3%


Selected WACC	6.4%

ML.BK'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 ML.BK:

cost_of_equity (9.85%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.58) + 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.