Reference no: EM133116138
Pic Berhad wishes to issue sukuk worth RM1 million and the maturity value is RM1,000. The sukuk is expected to pay a semi-annual coupon of 5% per year for the next 15 years. The investment banker estimated that it can be sold for RM930 each, and the floatation cost is 2.5%.
The sukuk can be called at year 10 and the maturity value will be RM1,200 each.
Tax rate is 24%.
a) Calculate the annual cost of debt. _________%
b) The after tax cost of debt is _______%
c) If the issuance is a callable sukuk, what is the annual cost of debt? _________%
d)The after tax cost of debt is _________%
The company has the following financing:
Motor vehicles: RM125,000 -- rate 2.85% p.a.
Property: RM1.2 million -- rate 3.01% p.a.
Business Financing: RM800,000 -- rate 7.3%
The tax rate is 24%.
a) Total debt financing is RM_________.
b) Weight for Property financing is ______%
c) Weighted cost of debt on financing is _______%
d) After tax cost of debt on financing is ________%