The WACC of Yinson Holdings Bhd (YINSON.KL) is 8.7%.
Range | Selected | |
Cost of equity | 13.4% - 17.6% | 15.5% |
Tax rate | 28.1% - 29.9% | 29% |
Cost of debt | 8.1% - 9.0% | 8.55% |
WACC | 7.9% - 9.4% | 8.7% |
Category | Low | High |
Long-term bond rate | 3.8% | 4.3% |
Equity market risk premium | 6.9% | 7.8% |
Adjusted beta | 1.4 | 1.64 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 13.4% | 17.6% |
Tax rate | 28.1% | 29.9% |
Debt/Equity ratio | 2.63 | 2.63 |
Cost of debt | 8.1% | 9.0% |
After-tax WACC | 7.9% | 9.4% |
Selected WACC | 8.7% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
YINSON.KL | Yinson Holdings Bhd | 2.63 | 1.63 | 0.57 |
1960.HK | TBK & Sons Holdings Ltd | 0.07 | 0.11 | 0.1 |
ARMADA.KL | Bumi Armada Bhd | 1.26 | 1.41 | 0.74 |
CARIMIN.KL | Carimin Petroleum Bhd | 0.07 | 0.56 | 0.53 |
DAYANG.KL | Dayang Enterprise Holdings Bhd | 0.06 | 0.98 | 0.94 |
DELEUM.KL | Deleum Bhd | 0.02 | 1.05 | 1.03 |
MHB.KL | Malaysia Marine and Heavy Engineering Holdings Bhd | 0.45 | 1.12 | 0.85 |
PENERGY.KL | Petra Energy Bhd | 0.28 | 0.76 | 0.64 |
UZMA.KL | Uzma Bhd | 2.45 | 1.32 | 0.48 |
WASEONG.KL | Wah Seong Corporation Bhd | 1.35 | 1 | 0.51 |
Low | High | |
Unlevered beta | 0.56 | 0.68 |
Relevered beta | 1.6 | 1.96 |
Adjusted relevered beta | 1.4 | 1.64 |
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 YINSON.KL:
cost_of_equity (15.50%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (1.4) + 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.