MPHBCAP.KL WACC - Weighted Average Cost of Capital
The WACC of MPHB Capital Bhd (MPHBCAP.KL) is 8.1%.
| Range | Selected | |
| Cost of equity | 7.2% - 9.1% | 8.15% |
| Tax rate | 15.7% - 16.9% | 16.3% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.2% - 9.1% | 8.1% |
| Category | Low | High |
| Long-term bond rate | 3.8% | 4.3% |
| Equity market risk premium | 6.9% | 7.8% |
| Adjusted beta | 0.49 | 0.54 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.2% | 9.1% |
| Tax rate | 15.7% | 16.9% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.2% | 9.1% |
| Selected WACC | 8.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MPHBCAP.KL | MPHB Capital Bhd | 0 | 0.11 | 0.11 |
| 6161.HK | Target Insurance Holdings Ltd | 0.87 | -0.03 | -0.02 |
| 8070.SR | Arabian Shield Cooperative Insurance Company SJSC | 0 | 1 | 0.99 |
| 8270.SR | Buruj Cooperative Insurance Co SJSC | 0 | 1.55 | 1.55 |
| BIC.VN | BIDV Insurance Corp | 0.07 | 0.37 | 0.35 |
| DOHI.QA | Doha Insurance Group QPSC | 0.11 | 0.01 | 0.01 |
| LPI.KL | Lpi Capital Bhd | 0.01 | 0.62 | 0.61 |
| NKI.BK | Navakij Insurance PCL | 0.04 | 0.19 | 0.18 |
| P&O.KL | Pacific & Orient Berhad | 0.2 | 0.33 | 0.28 |
| PGI.VN | Petrolimex Insurance Corp | 0.26 | 0.36 | 0.3 |
| Low | High | |
| Unlevered beta | 0.24 | 0.32 |
| Relevered beta | 0.24 | 0.31 |
| Adjusted relevered beta | 0.49 | 0.54 |
MPHBCAP.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 MPHBCAP.KL:
cost_of_equity (8.15%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.49) + 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.