1252.HK WACC - Weighted Average Cost of Capital

The WACC of China Tianrui Group Cement Co Ltd (1252.HK) is 10.6%.

The Cost of Equity of China Tianrui Group Cement Co Ltd (1252.HK) is 42.60%.

The Cost of Debt of China Tianrui Group Cement Co Ltd (1252.HK) is 11.05%.

	Range	Selected
Cost of equity	36.20% - 49.00%	42.60%
Tax rate	14.80% - 18.70%	16.75%
Cost of debt	7.50% - 14.60%	11.05%
WACC	7.7% - 13.5%	10.6%

WACC

1252.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	5.57	6.47

Additional risk adjustments	0.0%	0.5%
Cost of equity	36.20%	49.00%

Tax rate	14.80%	18.70%
Debt/Equity ratio	21.61	21.61
Cost of debt	7.50%	14.60%

After-tax WACC	7.7%	13.5%


Selected WACC	10.6%

1252.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 1252.HK:

cost_of_equity (42.60%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (5.57) + 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.