1250.HK WACC - Weighted Average Cost of Capital

The WACC of Beijing Enterprises Clean Energy Group Ltd (1250.HK) is 6.5%.

The Cost of Equity of Beijing Enterprises Clean Energy Group Ltd (1250.HK) is 17.85%.

The Cost of Debt of Beijing Enterprises Clean Energy Group Ltd (1250.HK) is 6.25%.

	Range	Selected
Cost of equity	7.30% - 28.40%	17.85%
Tax rate	17.40% - 24.10%	20.75%
Cost of debt	4.40% - 8.10%	6.25%
WACC	4.1% - 9.0%	6.5%

WACC

1250.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.74	3.52

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.30%	28.40%

Tax rate	17.40%	24.10%
Debt/Equity ratio	6.8	6.8
Cost of debt	4.40%	8.10%

After-tax WACC	4.1%	9.0%


Selected WACC	6.5%

1250.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 1250.HK:

cost_of_equity (17.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.74) + 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.