1449.HK WACC - Weighted Average Cost of Capital

The WACC of Leader Education Ltd (1449.HK) is 8.2%.

The Cost of Equity of Leader Education Ltd (1449.HK) is 10.25%.

The Cost of Debt of Leader Education Ltd (1449.HK) is 10.20%.

	Range	Selected
Cost of equity	7.30% - 13.20%	10.25%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	5.80% - 14.60%	10.20%
WACC	4.8% - 11.6%	8.2%

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	0.74	1.33

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.30%	13.20%

Tax rate	22.10%	22.30%
Debt/Equity ratio	7.53	7.53
Cost of debt	5.80%	14.60%

After-tax WACC	4.8%	11.6%


Selected WACC	8.2%

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 (10.25%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.74) + 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.