TOMEI.KL WACC - Weighted Average Cost of Capital

The WACC of Tomei Consolidated Bhd (TOMEI.KL) is 7.2%.

The Cost of Equity of Tomei Consolidated Bhd (TOMEI.KL) is 12.50%.

The Cost of Debt of Tomei Consolidated Bhd (TOMEI.KL) is 4.60%.

	Range	Selected
Cost of equity	10.60% - 14.40%	12.50%
Tax rate	26.00% - 26.40%	26.20%
Cost of debt	4.30% - 4.90%	4.60%
WACC	6.3% - 8.1%	7.2%

WACC

TOMEI.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.99	1.22

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.60%	14.40%

Tax rate	26.00%	26.40%
Debt/Equity ratio	1.37	1.37
Cost of debt	4.30%	4.90%

After-tax WACC	6.3%	8.1%


Selected WACC	7.2%

TOMEI.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 TOMEI.KL:

cost_of_equity (12.50%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.99) + 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.