The earnings, dividends, and stock price of LDM, Inc. are expected to grow at 7 percent per year after this year. Its common stock sells for P23 per share, its last dividend was P2.00 and will pay P2.14 at the end of the current year. It should pay P2.50 flotation cost. If the firm's beta is 1.75, the risk-free rate is 8 percent, and the average return on the market is 12 percent, what will be the firm's cost of equity using the CAPM approach?