1164.HK WACC - Weighted Average Cost of Capital

The WACC of CGN Mining Co Ltd (1164.HK) is 7.3%.

The Cost of Equity of CGN Mining Co Ltd (1164.HK) is 7.05%.

The Cost of Debt of CGN Mining Co Ltd (1164.HK) is 9.65%.

	Range	Selected
Cost of equity	5.20% - 8.90%	7.05%
Tax rate	10.50% - 16.30%	13.40%
Cost of debt	4.70% - 14.60%	9.65%
WACC	5.1% - 9.5%	7.3%

WACC

1164.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.4	0.73

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.20%	8.90%

Tax rate	10.50%	16.30%
Debt/Equity ratio	0.2	0.2
Cost of debt	4.70%	14.60%

After-tax WACC	5.1%	9.5%


Selected WACC	7.3%

1164.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 1164.HK:

cost_of_equity (7.05%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.4) + 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.