1657.HK WACC - Weighted Average Cost of Capital
The WACC of SG Group Holdings Ltd (1657.HK) is 6.7%.
| Range | Selected | |
| Cost of equity | 5.2% - 8.2% | 6.7% |
| Tax rate | 11.5% - 35.1% | 23.3% |
| Cost of debt | 5.6% - 7.0% | 6.3% |
| WACC | 5.2% - 8.1% | 6.7% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.39 | 0.62 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.2% | 8.2% |
| Tax rate | 11.5% | 35.1% |
| Debt/Equity ratio | 0.02 | 0.02 |
| Cost of debt | 5.6% | 7.0% |
| After-tax WACC | 5.2% | 8.1% |
| Selected WACC | 6.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1657.HK | SG Group Holdings Ltd | 0.02 | 0.46 | 0.45 |
| 1520.HK | CEFC Hong Kong Financial Investment Company Ltd | 0.05 | -0.72 | -0.69 |
| 1825.HK | Sterling Group Holdings Ltd | 3.63 | 0.04 | 0.01 |
| 1842.HK | Grown Up Group Investment Holdings Ltd | 0.69 | 0.9 | 0.57 |
| 213.HK | National Electronics Holdings Ltd | 14.39 | 0.25 | 0.02 |
| 475.HK | Central Development Holdings Ltd | 0.66 | -0.37 | -0.24 |
| 643.HK | Carry Wealth Holdings Ltd | 0.01 | 0.58 | 0.58 |
| 8219.HK | Hanvey Group Holdings Ltd | 1.69 | 1.6 | 0.68 |
| 8285.HK | Sling Group Holdings Ltd | 1.78 | 0.34 | 0.14 |
| 8456.HK | Mansion International Holdings Ltd | 0.3 | 0.5 | 0.4 |
| Low | High | |
| Unlevered beta | 0.09 | 0.42 |
| Relevered beta | 0.09 | 0.43 |
| Adjusted relevered beta | 0.39 | 0.62 |
1657.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 1657.HK:
cost_of_equity (6.70%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.39) + 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.