1146.HK WACC - Weighted Average Cost of Capital
The WACC of China Outfitters Holdings Ltd (1146.HK) is 6.1%.
| Range | Selected | |
| Cost of equity | 5.3% - 7.1% | 6.2% |
| Tax rate | 25.9% - 28.2% | 27.05% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.2% - 6.9% | 6.1% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.41 | 0.46 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.3% | 7.1% |
| Tax rate | 25.9% | 28.2% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.2% | 6.9% |
| Selected WACC | 6.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1146.HK | China Outfitters Holdings Ltd | 0.05 | 0.17 | 0.17 |
| 1027.HK | China Jicheng Holdings Ltd | 0.22 | 0.07 | 0.06 |
| 1247.HK | Miko International Holdings Ltd | 0.06 | -0.57 | -0.54 |
| 1425.HK | Justin Allen Holdings Ltd | 0.03 | 0.12 | 0.11 |
| 1532.HK | China Partytime Culture Holdings Ltd | 0.12 | 0.12 | 0.11 |
| 1906.HK | Bonny International Holding Ltd | 0.33 | -0.41 | -0.33 |
| 540.HK | Speedy Global Holdings Ltd | 0.72 | 1.53 | 1 |
| 600146.SS | Shangying Global Co Ltd | 2.51 | 1.4 | 0.49 |
| 603196.SS | Ribo Fashion Group Co Ltd | 0.05 | 1.94 | 1.87 |
| 837.HK | Carpenter Tan Holdings Ltd | 0.01 | 0.23 | 0.23 |
| Low | High | |
| Unlevered beta | 0.11 | 0.19 |
| Relevered beta | 0.12 | 0.19 |
| Adjusted relevered beta | 0.41 | 0.46 |
1146.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 1146.HK:
cost_of_equity (6.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.41) + 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.