The WACC of Malaysia Pacific Corporation Bhd (MPCORP.KL) is 7.1%.
Range | Selected | |
Cost of equity | 6.2% - 8.4% | 7.3% |
Tax rate | 24.0% - 24.0% | 24% |
Cost of debt | 4.0% - 7.0% | 5.5% |
WACC | 6.0% - 8.2% | 7.1% |
Category | Low | High |
Long-term bond rate | 3.8% | 4.3% |
Equity market risk premium | 6.9% | 7.8% |
Adjusted beta | 0.35 | 0.46 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.2% | 8.4% |
Tax rate | 24.0% | 24.0% |
Debt/Equity ratio | 0.06 | 0.06 |
Cost of debt | 4.0% | 7.0% |
After-tax WACC | 6.0% | 8.2% |
Selected WACC | 7.1% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
MPCORP.KL | Malaysia Pacific Corporation Bhd | 0.06 | 2.17 | 2.07 |
2379.HK | Zhongtian International Ltd | 7.32 | 0.23 | 0.04 |
495.HK | Paladin Ltd | 6.8 | 0.51 | 0.08 |
5GZ.SI | HGH Holdings Ltd | 0.3 | -0.22 | -0.18 |
BERTAM.KL | Bertam Alliance Bhd | 0.09 | -0.43 | -0.41 |
LBICAP.KL | Lbi Capital Bhd | 0.22 | 0.94 | 0.81 |
MAGNA.KL | Magna Prima Bhd | 0 | -0.36 | -0.36 |
MUH.KL | Multi-Usage Holdings Bhd | 0.01 | 0.35 | 0.34 |
SAPRES.KL | Sapura Resources Bhd | 10.44 | 0.22 | 0.02 |
TANCO.KL | Tanco Holdings Bhd | 0.01 | 0.93 | 0.92 |
TCIDEVELOP.NS | TCI Developers Ltd | 0.07 | 0.41 | 0.39 |
Low | High | |
Unlevered beta | 0.04 | 0.34 |
Relevered beta | 0.03 | 0.19 |
Adjusted relevered beta | 0.35 | 0.46 |
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 MPCORP.KL:
cost_of_equity (7.30%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.35) + 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.