1118.HK WACC - Weighted Average Cost of Capital
The WACC of Golik Holdings Ltd (1118.HK) is 6.0%.
| Range | Selected | |
| Cost of equity | 6.2% - 11.4% | 8.8% |
| Tax rate | 12.4% - 13.9% | 13.15% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.7% - 7.3% | 6.0% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.55 | 1.08 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.2% | 11.4% |
| Tax rate | 12.4% | 13.9% |
| Debt/Equity ratio | 1.23 | 1.23 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.7% | 7.3% |
| Selected WACC | 6.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1118.HK | Golik Holdings Ltd | 1.23 | 0.13 | 0.06 |
| 002710.KS | TCC Steel Corp | 0.49 | 1.64 | 1.15 |
| 103.HK | Shougang Concord Century Holdings Ltd | 0.42 | 0.17 | 0.13 |
| 1116.HK | Mayer Holdings Ltd | 0.45 | -0.05 | -0.04 |
| 1203.HK | GDH Guangnan Holdings Ltd | 1.23 | 0.38 | 0.18 |
| 1231.HK | Newton Resources Ltd | 0.01 | -0.34 | -0.34 |
| 581.HK | China Oriental Group Co Ltd | 3.58 | 0.82 | 0.2 |
| JAIBALAJI.NS | Jai Balaji Industries Ltd | 0.04 | 1.28 | 1.24 |
| MAHSEAMLES.NS | Maharashtra Seamless Ltd | 0 | 1.63 | 1.63 |
| PRAKASH.NS | Prakash Industries Ltd | 0.15 | 1.2 | 1.06 |
| Low | High | |
| Unlevered beta | 0.16 | 0.55 |
| Relevered beta | 0.33 | 1.12 |
| Adjusted relevered beta | 0.55 | 1.08 |
1118.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 1118.HK:
cost_of_equity (8.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.55) + 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.