PTRANS.KL
Perak Transit Bhd
Price:  
0.7 
MYR
Volume:  
6,147,700
Malaysia | Road & Rail

PTRANS.KL WACC - Weighted Average Cost of Capital

The WACC of Perak Transit Bhd (PTRANS.KL) is 7.0%.

The Cost of Equity of Perak Transit Bhd (PTRANS.KL) is 9.35%.
The Cost of Debt of Perak Transit Bhd (PTRANS.KL) is 5.8%.

RangeSelected
Cost of equity7.8% - 10.9%9.35%
Tax rate20.2% - 20.9%20.55%
Cost of debt5.6% - 6.0%5.8%
WACC6.1% - 7.8%7.0%
WACC

PTRANS.KL WACC calculation

CategoryLowHigh
Long-term bond rate3.8%4.3%
Equity market risk premium6.9%7.8%
Adjusted beta0.580.78
Additional risk adjustments0.0%0.5%
Cost of equity7.8%10.9%
Tax rate20.2%20.9%
Debt/Equity ratio
0.990.99
Cost of debt5.6%6.0%
After-tax WACC6.1%7.8%
Selected WACC7.0%

PTRANS.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 PTRANS.KL:

cost_of_equity (9.35%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.58) + 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.