1451.HK WACC - Weighted Average Cost of Capital

The WACC of MS Group Holdings Ltd (1451.HK) is 9.4%.

The Cost of Equity of MS Group Holdings Ltd (1451.HK) is 9.35%.

The Cost of Debt of MS Group Holdings Ltd (1451.HK) is 16.25%.

	Range	Selected
Cost of equity	8.10% - 10.60%	9.35%
Tax rate	32.00% - 33.60%	32.80%
Cost of debt	4.00% - 28.50%	16.25%
WACC	7.9% - 10.8%	9.4%

WACC

1451.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.87	0.96

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.10%	10.60%

Tax rate	32.00%	33.60%
Debt/Equity ratio	0.03	0.03
Cost of debt	4.00%	28.50%

After-tax WACC	7.9%	10.8%


Selected WACC	9.4%

1451.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 1451.HK:

cost_of_equity (9.35%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.87) + 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.