TAANN.KL WACC - Weighted Average Cost of Capital

The WACC of Ta Ann Holdings Bhd (TAANN.KL) is 11.3%.

The Cost of Equity of Ta Ann Holdings Bhd (TAANN.KL) is 12.20%.

The Cost of Debt of Ta Ann Holdings Bhd (TAANN.KL) is 4.25%.

	Range	Selected
Cost of equity	9.90% - 14.50%	12.20%
Tax rate	25.00% - 25.30%	25.15%
Cost of debt	4.00% - 4.50%	4.25%
WACC	9.2% - 13.4%	11.3%

WACC

TAANN.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.89	1.24

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.90%	14.50%

Tax rate	25.00%	25.30%
Debt/Equity ratio	0.11	0.11
Cost of debt	4.00%	4.50%

After-tax WACC	9.2%	13.4%


Selected WACC	11.3%

TAANN.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 TAANN.KL:

cost_of_equity (12.20%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.89) + 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.