1545.HK WACC - Weighted Average Cost of Capital

The WACC of Design Capital Ltd (1545.HK) is 5.8%.

The Cost of Equity of Design Capital Ltd (1545.HK) is 6.45%.

The Cost of Debt of Design Capital Ltd (1545.HK) is 5.10%.

	Range	Selected
Cost of equity	5.20% - 7.70%	6.45%
Tax rate	18.60% - 19.90%	19.25%
Cost of debt	5.10% - 5.10%	5.10%
WACC	4.9% - 6.6%	5.8%

WACC

1545.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.4	0.55

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.20%	7.70%

Tax rate	18.60%	19.90%
Debt/Equity ratio	0.44	0.44
Cost of debt	5.10%	5.10%

After-tax WACC	4.9%	6.6%


Selected WACC	5.8%

1545.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 1545.HK:

cost_of_equity (6.45%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.4) + 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.