1359.HK WACC - Weighted Average Cost of Capital

The WACC of China Cinda Asset Management Co Ltd (1359.HK) is 5.6%.

The Cost of Equity of China Cinda Asset Management Co Ltd (1359.HK) is 48.95%.

The Cost of Debt of China Cinda Asset Management Co Ltd (1359.HK) is 6.05%.

	Range	Selected
Cost of equity	25.90% - 72.00%	48.95%
Tax rate	24.30% - 31.60%	27.95%
Cost of debt	4.00% - 8.10%	6.05%
WACC	3.7% - 7.5%	5.6%

WACC

1359.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	3.86	9.77

Additional risk adjustments	0.0%	0.5%
Cost of equity	25.90%	72.00%

Tax rate	24.30%	31.60%
Debt/Equity ratio	33.92	33.92
Cost of debt	4.00%	8.10%

After-tax WACC	3.7%	7.5%


Selected WACC	5.6%

1359.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 1359.HK:

cost_of_equity (48.95%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (3.86) + 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.