1013.HK WACC - Weighted Average Cost of Capital

The WACC of Wai Chun Group Holdings Ltd (1013.HK) is 7.4%.

The Cost of Equity of Wai Chun Group Holdings Ltd (1013.HK) is 23.75%.

The Cost of Debt of Wai Chun Group Holdings Ltd (1013.HK) is 5.00%.

	Range	Selected
Cost of equity	18.30% - 29.20%	23.75%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.4% - 8.3%	7.4%

WACC

1013.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	2.59	3.63

Additional risk adjustments	0.0%	0.5%
Cost of equity	18.30%	29.20%

Tax rate	22.10%	22.30%
Debt/Equity ratio	4.74	4.74
Cost of debt	5.00%	5.00%

After-tax WACC	6.4%	8.3%


Selected WACC	7.4%

1013.HK'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 1013.HK:

cost_of_equity (23.75%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.59) + 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.