SUNCON.KL
Sunway Construction Group Bhd
Price:  
6.00 
MYR
Volume:  
4,246,000.00
Malaysia | Construction & Engineering
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SUNCON.KL WACC - Weighted Average Cost of Capital

The WACC of Sunway Construction Group Bhd (SUNCON.KL) is 10.0%.

The Cost of Equity of Sunway Construction Group Bhd (SUNCON.KL) is 10.50%.
The Cost of Debt of Sunway Construction Group Bhd (SUNCON.KL) is 5.70%.

Range Selected
Cost of equity 9.30% - 11.70% 10.50%
Tax rate 26.20% - 27.30% 26.75%
Cost of debt 5.00% - 6.40% 5.70%
WACC 8.8% - 11.1% 10.0%
WACC

SUNCON.KL WACC calculation

Category Low High
Long-term bond rate 3.8% 4.3%
Equity market risk premium 6.9% 7.8%
Adjusted beta 0.81 0.88
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.30% 11.70%
Tax rate 26.20% 27.30%
Debt/Equity ratio 0.1 0.1
Cost of debt 5.00% 6.40%
After-tax WACC 8.8% 11.1%
Selected WACC 10.0%

SUNCON.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 SUNCON.KL:

cost_of_equity (10.50%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.81) + 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.