1050.HK WACC - Weighted Average Cost of Capital

The WACC of Karrie International Holdings Ltd (1050.HK) is 7.0%.

The Cost of Equity of Karrie International Holdings Ltd (1050.HK) is 8.20%.

The Cost of Debt of Karrie International Holdings Ltd (1050.HK) is 4.25%.

	Range	Selected
Cost of equity	6.70% - 9.70%	8.20%
Tax rate	12.20% - 20.80%	16.50%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.9% - 8.1%	7.0%

WACC

1050.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.65	0.83

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.70%	9.70%

Tax rate	12.20%	20.80%
Debt/Equity ratio	0.36	0.36
Cost of debt	4.00%	4.50%

After-tax WACC	5.9%	8.1%


Selected WACC	7.0%

1050.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 1050.HK:

cost_of_equity (8.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.65) + 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.