1162.HK WACC - Weighted Average Cost of Capital
The WACC of Lumina Group Ltd (1162.HK) is 6.2%.
| Range | Selected | |
| Cost of equity | 5.4% - 6.9% | 6.15% |
| Tax rate | 11.9% - 23.1% | 17.5% |
| Cost of debt | 7.0% - 7.0% | 7% |
| WACC | 5.4% - 6.9% | 6.2% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.43 | 0.44 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.4% | 6.9% |
| Tax rate | 11.9% | 23.1% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 7.0% | 7.0% |
| After-tax WACC | 5.4% | 6.9% |
| Selected WACC | 6.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1162.HK | Lumina Group Ltd | 0.01 | 0.14 | 0.14 |
| 1397.HK | Baguio Green Group Ltd | 0.42 | 0.24 | 0.18 |
| 154.HK | Beijing Enterprises Environment Group Ltd | 7.34 | 0.38 | 0.05 |
| 8013.HK | ECI Technology Holdings Ltd | 0.12 | 0.3 | 0.28 |
| 8031.HK | ETS Group Ltd | 0.06 | 0.15 | 0.15 |
| 8309.HK | Man Shing Global Holdings Ltd | 1.03 | 0.28 | 0.15 |
| 8315.HK | Greatwalle Inc | 0.36 | 0.68 | 0.52 |
| 8441.HK | IWS Group Holdings Ltd | 0.01 | 1.03 | 1.03 |
| 969.HK | Hua Lien International Holding Co Ltd | 3.47 | 0.05 | 0.01 |
| 9925.TW | Taiwan Shin Kong Security Co Ltd | 0.19 | 0.14 | 0.12 |
| Low | High | |
| Unlevered beta | 0.14 | 0.16 |
| Relevered beta | 0.15 | 0.16 |
| Adjusted relevered beta | 0.43 | 0.44 |
1162.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 1162.HK:
cost_of_equity (6.15%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.43) + 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.