1303.HK WACC - Weighted Average Cost of Capital

The WACC of Huili Resources Group Ltd (1303.HK) is 10.7%.

The Cost of Equity of Huili Resources Group Ltd (1303.HK) is 10.80%.

The Cost of Debt of Huili Resources Group Ltd (1303.HK) is 8.80%.

	Range	Selected
Cost of equity	9.50% - 12.10%	10.80%
Tax rate	15.80% - 17.50%	16.65%
Cost of debt	4.00% - 13.60%	8.80%
WACC	9.4% - 12.1%	10.7%

WACC

1303.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.11	1.18

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.50%	12.10%

Tax rate	15.80%	17.50%
Debt/Equity ratio	0.02	0.02
Cost of debt	4.00%	13.60%

After-tax WACC	9.4%	12.1%


Selected WACC	10.7%

1303.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 1303.HK:

cost_of_equity (10.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.11) + 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.