MUDA.KL WACC - Weighted Average Cost of Capital

The WACC of Muda Holdings Bhd (MUDA.KL) is 5.3%.

The Cost of Equity of Muda Holdings Bhd (MUDA.KL) is 8.90%.

The Cost of Debt of Muda Holdings Bhd (MUDA.KL) is 5.75%.

	Range	Selected
Cost of equity	6.80% - 11.00%	8.90%
Tax rate	26.40% - 34.20%	30.30%
Cost of debt	4.50% - 7.00%	5.75%
WACC	4.2% - 6.3%	5.3%

WACC

MUDA.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.44	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.80%	11.00%

Tax rate	26.40%	34.20%
Debt/Equity ratio	2.84	2.84
Cost of debt	4.50%	7.00%

After-tax WACC	4.2%	6.3%


Selected WACC	5.3%

MUDA.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 MUDA.KL:

cost_of_equity (8.90%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.44) + 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.