1029.HK WACC - Weighted Average Cost of Capital

The WACC of IRC Ltd (1029.HK) is 9.7%.

The Cost of Equity of IRC Ltd (1029.HK) is 10.60%.

The Cost of Debt of IRC Ltd (1029.HK) is 7.65%.

	Range	Selected
Cost of equity	8.50% - 12.70%	10.60%
Tax rate	1.30% - 2.20%	1.75%
Cost of debt	7.00% - 8.30%	7.65%
WACC	8.0% - 11.3%	9.7%

WACC

1029.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.94	1.27

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.50%	12.70%

Tax rate	1.30%	2.20%
Debt/Equity ratio	0.44	0.44
Cost of debt	7.00%	8.30%

After-tax WACC	8.0%	11.3%


Selected WACC	9.7%

1029.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 1029.HK:

cost_of_equity (10.60%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.94) + 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.