1250.HK WACC - Weighted Average Cost of Capital

The WACC of Beijing Enterprises Clean Energy Group Ltd (1250.HK) is 5.6%.

The Cost of Equity of Beijing Enterprises Clean Energy Group Ltd (1250.HK) is 14.45%.

The Cost of Debt of Beijing Enterprises Clean Energy Group Ltd (1250.HK) is 6.30%.

	Range	Selected
Cost of equity	7.30% - 21.60%	14.45%
Tax rate	26.00% - 31.20%	28.60%
Cost of debt	4.50% - 8.10%	6.30%
WACC	3.8% - 7.4%	5.6%

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	2.54

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.30%	21.60%

Tax rate	26.00%	31.20%
Debt/Equity ratio	7.55	7.55
Cost of debt	4.50%	8.10%

After-tax WACC	3.8%	7.4%


Selected WACC	5.6%

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 (14.45%) = 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.