1449.HK WACC - Weighted Average Cost of Capital

The WACC of Leader Education Ltd (1449.HK) is 6.7%.

The Cost of Equity of Leader Education Ltd (1449.HK) is 9.50%.

The Cost of Debt of Leader Education Ltd (1449.HK) is 8.05%.

	Range	Selected
Cost of equity	8.10% - 10.90%	9.50%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	4.70% - 11.40%	8.05%
WACC	4.2% - 9.1%	6.7%

WACC

1449.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.88	1

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.10%	10.90%

Tax rate	22.10%	22.30%
Debt/Equity ratio	7.22	7.22
Cost of debt	4.70%	11.40%

After-tax WACC	4.2%	9.1%


Selected WACC	6.7%

1449.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 1449.HK:

cost_of_equity (9.50%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.88) + 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.