PANAMY.KL WACC - Weighted Average Cost of Capital

The WACC of Panasonic Manufacturing Malaysia Bhd (PANAMY.KL) is 8.0%.

The Cost of Equity of Panasonic Manufacturing Malaysia Bhd (PANAMY.KL) is 7.90%.

The Cost of Debt of Panasonic Manufacturing Malaysia Bhd (PANAMY.KL) is 41.85%.

	Range	Selected
Cost of equity	6.80% - 9.00%	7.90%
Tax rate	11.80% - 12.60%	12.20%
Cost of debt	4.40% - 79.30%	41.85%
WACC	6.8% - 9.2%	8.0%

WACC

PANAMY.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	0.54

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.80%	9.00%

Tax rate	11.80%	12.60%
Debt/Equity ratio	0	0
Cost of debt	4.40%	79.30%

After-tax WACC	6.8%	9.2%


Selected WACC	8.0%

PANAMY.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 PANAMY.KL:

cost_of_equity (7.90%) = 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.