UMCCA.KL
United Malacca Bhd
Price:  
5.28 
MYR
Volume:  
41,400
Malaysia | Food Products

UMCCA.KL WACC - Weighted Average Cost of Capital

The WACC of United Malacca Bhd (UMCCA.KL) is 8.7%.

The Cost of Equity of United Malacca Bhd (UMCCA.KL) is 9.2%.
The Cost of Debt of United Malacca Bhd (UMCCA.KL) is 5.2%.

RangeSelected
Cost of equity7.9% - 10.5%9.2%
Tax rate30.4% - 33.9%32.15%
Cost of debt4.4% - 6.0%5.2%
WACC7.5% - 9.9%8.7%
WACC

UMCCA.KL WACC calculation

CategoryLowHigh
Long-term bond rate3.8%4.3%
Equity market risk premium6.9%7.8%
Adjusted beta0.60.72
Additional risk adjustments0.0%0.5%
Cost of equity7.9%10.5%
Tax rate30.4%33.9%
Debt/Equity ratio
0.10.1
Cost of debt4.4%6.0%
After-tax WACC7.5%9.9%
Selected WACC8.7%

UMCCA.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 UMCCA.KL:

cost_of_equity (9.20%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.6) + 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.