MMAG.KL WACC - Weighted Average Cost of Capital

The WACC of MMAG Holdings Bhd (MMAG.KL) is 11.9%.

The Cost of Equity of MMAG Holdings Bhd (MMAG.KL) is 21.55%.

The Cost of Debt of MMAG Holdings Bhd (MMAG.KL) is 10.80%.

	Range	Selected
Cost of equity	17.40% - 25.70%	21.55%
Tax rate	1.50% - 2.70%	2.10%
Cost of debt	6.00% - 15.60%	10.80%
WACC	7.4% - 16.5%	11.9%

WACC

MMAG.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	1.98	2.67

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.40%	25.70%

Tax rate	1.50%	2.70%
Debt/Equity ratio	6.72	6.72
Cost of debt	6.00%	15.60%

After-tax WACC	7.4%	16.5%


Selected WACC	11.9%

MMAG.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 MMAG.KL:

cost_of_equity (21.55%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (1.98) + 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.