WZSATU.KL WACC - Weighted Average Cost of Capital

The WACC of WZ Satu Bhd (WZSATU.KL) is 9.9%.

The Cost of Equity of WZ Satu Bhd (WZSATU.KL) is 10.60%.

The Cost of Debt of WZ Satu Bhd (WZSATU.KL) is 7.90%.

	Range	Selected
Cost of equity	9.30% - 11.90%	10.60%
Tax rate	1.80% - 1.90%	1.85%
Cost of debt	7.50% - 8.30%	7.90%
WACC	8.8% - 11.0%	9.9%

WACC

WZSATU.KL WACC calculation

Category	Low	High

Long-term bond rate	4.2%	4.7%
Equity market risk premium	5.9%	6.9%
Adjusted beta	0.85	0.96

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.30%	11.90%

Tax rate	1.80%	1.90%
Debt/Equity ratio	0.31	0.31
Cost of debt	7.50%	8.30%

After-tax WACC	8.8%	11.0%


Selected WACC	9.9%

WZSATU.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 WZSATU.KL:

cost_of_equity (10.60%) = risk_free_rate (4.45%) + equity_risk_premium (6.40%) * adjusted_beta (0.85) + 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.