SKPRES.KL
SKP Resources Bhd
Price:  
0.98 
MYR
Volume:  
535,000.00
Malaysia | Electronic Equipment, Instruments & Components
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SKPRES.KL WACC - Weighted Average Cost of Capital

The WACC of SKP Resources Bhd (SKPRES.KL) is 10.4%.

The Cost of Equity of SKP Resources Bhd (SKPRES.KL) is 10.70%.
The Cost of Debt of SKP Resources Bhd (SKPRES.KL) is 6.70%.

Range Selected
Cost of equity 8.60% - 12.80% 10.70%
Tax rate 21.90% - 22.10% 22.00%
Cost of debt 4.40% - 9.00% 6.70%
WACC 8.3% - 12.5% 10.4%
WACC

SKPRES.KL WACC calculation

Category Low High
Long-term bond rate 3.8% 4.3%
Equity market risk premium 6.9% 7.8%
Adjusted beta 0.7 1.02
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.60% 12.80%
Tax rate 21.90% 22.10%
Debt/Equity ratio 0.05 0.05
Cost of debt 4.40% 9.00%
After-tax WACC 8.3% 12.5%
Selected WACC 10.4%

SKPRES.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 SKPRES.KL:

cost_of_equity (10.70%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.7) + 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.