MFCB.KL WACC - Weighted Average Cost of Capital

The WACC of Mega First Corporation Bhd (MFCB.KL) is 9.9%.

The Cost of Equity of Mega First Corporation Bhd (MFCB.KL) is 11.85%.

The Cost of Debt of Mega First Corporation Bhd (MFCB.KL) is 4.80%.

	Range	Selected
Cost of equity	10.30% - 13.40%	11.85%
Tax rate	3.40% - 4.10%	3.75%
Cost of debt	4.50% - 5.10%	4.80%
WACC	8.7% - 11.1%	9.9%

WACC

MFCB.KL WACC calculation

Category	Low	High

Long-term bond rate	3.8%	4.3%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.95	1.09

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.30%	13.40%

Tax rate	3.40%	4.10%
Debt/Equity ratio	0.37	0.37
Cost of debt	4.50%	5.10%

After-tax WACC	8.7%	11.1%


Selected WACC	9.9%

MFCB.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 MFCB.KL:

cost_of_equity (11.85%) = risk_free_rate (4.05%) + equity_risk_premium (7.35%) * adjusted_beta (0.95) + 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.