117.HK WACC - Weighted Average Cost of Capital

The WACC of Tianli Holdings Group Ltd (117.HK) is 6.7%.

The Cost of Equity of Tianli Holdings Group Ltd (117.HK) is 13.30%.

The Cost of Debt of Tianli Holdings Group Ltd (117.HK) is 6.05%.

	Range	Selected
Cost of equity	10.30% - 16.30%	13.30%
Tax rate	5.70% - 9.60%	7.65%
Cost of debt	4.00% - 8.10%	6.05%
WACC	4.8% - 8.7%	6.7%

WACC

117.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.25	1.77

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.30%	16.30%

Tax rate	5.70%	9.60%
Debt/Equity ratio	5.51	5.51
Cost of debt	4.00%	8.10%

After-tax WACC	4.8%	8.7%


Selected WACC	6.7%

117.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 117.HK:

cost_of_equity (13.30%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.25) + 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.