126.HK WACC - Weighted Average Cost of Capital

The WACC of Carrianna Group Holdings Company Ltd (126.HK) is 5.3%.

The Cost of Equity of Carrianna Group Holdings Company Ltd (126.HK) is 8.70%.

The Cost of Debt of Carrianna Group Holdings Company Ltd (126.HK) is 6.10%.

	Range	Selected
Cost of equity	7.10% - 10.30%	8.70%
Tax rate	17.80% - 28.00%	22.90%
Cost of debt	5.20% - 7.00%	6.10%
WACC	4.7% - 5.8%	5.3%

WACC

126.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.7	0.92

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.10%	10.30%

Tax rate	17.80%	28.00%
Debt/Equity ratio	5.65	5.65
Cost of debt	5.20%	7.00%

After-tax WACC	4.7%	5.8%


Selected WACC	5.3%

126.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 126.HK:

cost_of_equity (8.70%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.7) + 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.