1090.HK WACC - Weighted Average Cost of Capital

The WACC of Da Ming International Holdings Ltd (1090.HK) is 8.4%.

The Cost of Equity of Da Ming International Holdings Ltd (1090.HK) is 21.55%.

The Cost of Debt of Da Ming International Holdings Ltd (1090.HK) is 9.30%.

	Range	Selected
Cost of equity	18.10% - 25.00%	21.55%
Tax rate	15.80% - 22.00%	18.90%
Cost of debt	4.00% - 14.60%	9.30%
WACC	4.4% - 12.4%	8.4%

WACC

1090.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	2.54	3.02

Additional risk adjustments	0.0%	0.5%
Cost of equity	18.10%	25.00%

Tax rate	15.80%	22.00%
Debt/Equity ratio	13.35	13.35
Cost of debt	4.00%	14.60%

After-tax WACC	4.4%	12.4%


Selected WACC	8.4%

1090.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 1090.HK:

cost_of_equity (21.55%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.54) + 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.