TSH.KL WACC - Weighted Average Cost of Capital
The WACC of TSH Resources Bhd (TSH.KL) is 8.6%.
| Range | Selected | |
| Cost of equity | 8.1% - 11.0% | 9.55% |
| Tax rate | 23.8% - 27.8% | 25.8% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 7.4% - 9.9% | 8.6% |
| Category | Low | High |
| Long-term bond rate | 3.8% | 4.3% |
| Equity market risk premium | 6.9% | 7.8% |
| Adjusted beta | 0.63 | 0.8 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.1% | 11.0% |
| Tax rate | 23.8% | 27.8% |
| Debt/Equity ratio | 0.17 | 0.17 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 7.4% | 9.9% |
| Selected WACC | 8.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TSH.KL | TSH Resources Bhd | 0.17 | 1.08 | 0.96 |
| BPLANT.KL | Boustead Plantations Bhd | 0.25 | 0.75 | 0.63 |
| FAREAST.KL | Far East Holdings Bhd | 0.05 | 0.04 | 0.04 |
| HSPLANT.KL | Hap Seng Plantations Holdings Bhd | 0.04 | 0.63 | 0.61 |
| IJMPLNT.KL | IJM Plantations Bhd | 0.26 | 0.87 | 0.73 |
| MHC.KL | MHC Plantations Bhd | 0.31 | 0.14 | 0.11 |
| NPC.KL | NPC Resources Bhd | 0.71 | -0.48 | -0.31 |
| RSAWIT.KL | Rimbunan Sawit Bhd | 0.58 | 1.52 | 1.06 |
| SWKPLNT.KL | Sarawak Plantation Bhd | 0.02 | 0.57 | 0.56 |
| UMCCA.KL | United Malacca Bhd | 0.1 | 0.16 | 0.15 |
| Low | High | |
| Unlevered beta | 0.4 | 0.62 |
| Relevered beta | 0.45 | 0.7 |
| Adjusted relevered beta | 0.63 | 0.8 |
TSH.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 TSH.KL:
cost_of_equity (9.55%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.63) + 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.