MNCN.JK WACC - Weighted Average Cost of Capital

The WACC of Media Nusantara Citra Tbk PT (MNCN.JK) is 12.9%.

The Cost of Equity of Media Nusantara Citra Tbk PT (MNCN.JK) is 16.40%.

The Cost of Debt of Media Nusantara Citra Tbk PT (MNCN.JK) is 5.50%.

	Range	Selected
Cost of equity	14.40% - 18.40%	16.40%
Tax rate	18.50% - 19.50%	19.00%
Cost of debt	4.00% - 7.00%	5.50%
WACC	11.2% - 14.7%	12.9%

WACC

MNCN.JK WACC calculation

Category	Low	High

Long-term bond rate	6.6%	7.1%
Equity market risk premium	7.9%	8.9%
Adjusted beta	0.99	1.21

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.40%	18.40%

Tax rate	18.50%	19.50%
Debt/Equity ratio	0.41	0.41
Cost of debt	4.00%	7.00%

After-tax WACC	11.2%	14.7%


Selected WACC	12.9%

MNCN.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 MNCN.JK:

cost_of_equity (16.40%) = risk_free_rate (6.85%) + equity_risk_premium (8.40%) * adjusted_beta (0.99) + 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.