1563.HK WACC - Weighted Average Cost of Capital

The WACC of International Alliance Financial Leasing Co Ltd (1563.HK) is 8.1%.

The Cost of Equity of International Alliance Financial Leasing Co Ltd (1563.HK) is 10.45%.

The Cost of Debt of International Alliance Financial Leasing Co Ltd (1563.HK) is 5.00%.

	Range	Selected
Cost of equity	8.50% - 12.40%	10.45%
Tax rate	24.40% - 32.10%	28.25%
Cost of debt	4.00% - 6.00%	5.00%
WACC	6.7% - 9.6%	8.1%

WACC

1563.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.95	1.22

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.50%	12.40%

Tax rate	24.40%	32.10%
Debt/Equity ratio	0.51	0.51
Cost of debt	4.00%	6.00%

After-tax WACC	6.7%	9.6%


Selected WACC	8.1%

1563.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 1563.HK:

cost_of_equity (10.45%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.95) + 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.