1486.HK
C Cheng Holdings Ltd
Price:  
0.21 
HKD
Volume:  
20,000
Hong Kong | Professional Services

1486.HK WACC - Weighted Average Cost of Capital

The WACC of C Cheng Holdings Ltd (1486.HK) is 8.0%.

The Cost of Equity of C Cheng Holdings Ltd (1486.HK) is 11.25%.
The Cost of Debt of C Cheng Holdings Ltd (1486.HK) is 5.5%.

RangeSelected
Cost of equity7.7% - 14.8%11.25%
Tax rate6.6% - 14.8%10.7%
Cost of debt4.0% - 7.0%5.5%
WACC5.7% - 10.2%8.0%
WACC

1486.HK WACC calculation

CategoryLowHigh
Long-term bond rate2.9%3.4%
Equity market risk premium6.0%7.0%
Adjusted beta0.811.57
Additional risk adjustments0.0%0.5%
Cost of equity7.7%14.8%
Tax rate6.6%14.8%
Debt/Equity ratio
1.071.07
Cost of debt4.0%7.0%
After-tax WACC5.7%10.2%
Selected WACC8.0%

1486.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 1486.HK:

cost_of_equity (11.25%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.81) + 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.