1440.HK WACC - Weighted Average Cost of Capital
The WACC of Deyun Holding Ltd (1440.HK) is 7.3%.
| Range | Selected | |
| Cost of equity | 6.2% - 8.4% | 7.3% |
| Tax rate | 8.0% - 13.8% | 10.9% |
| Cost of debt | 7.0% - 7.0% | 7% |
| WACC | 6.2% - 8.4% | 7.3% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.56 | 0.65 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.2% | 8.4% |
| Tax rate | 8.0% | 13.8% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 7.0% | 7.0% |
| After-tax WACC | 6.2% | 8.4% |
| Selected WACC | 7.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1440.HK | Deyun Holding Ltd | 0.01 | 0.74 | 0.74 |
| 002996.SZ | Chongqing Shunbo Aluminum Co Ltd | 1.83 | 1.09 | 0.42 |
| 003036.SZ | Zhejiang Taitan Co Ltd | 0.2 | 0.61 | 0.51 |
| 1455.HK | Fourace Industries Group Holdings Ltd | 0.01 | 0.21 | 0.21 |
| 1643.HK | Modern Chinese Medicine Group Co Ltd | 0 | 0.46 | 0.46 |
| 2135.HK | Raily Aesthetic Medicine International Holdings Ltd | 0.93 | 0.89 | 0.49 |
| 301.HK | Sanvo Fine Chemicals Group Ltd | 0.48 | -0.09 | -0.06 |
| 6600.HK | SciClone Pharmaceuticals (Holdings) Ltd | 0 | 0.49 | 0.49 |
| 8659.HK | Yik Wo International Holdings Ltd | 0.03 | -0.49 | -0.47 |
| 9936.HK | Ximei Resources Holding Ltd | 0.47 | -0.02 | -0.01 |
| Low | High | |
| Unlevered beta | 0.33 | 0.47 |
| Relevered beta | 0.34 | 0.48 |
| Adjusted relevered beta | 0.56 | 0.65 |
1440.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 1440.HK:
cost_of_equity (7.30%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.56) + 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.