1661.HK
Wisdom Sports Group
Price:  
0.58 
HKD
Volume:  
17,000.00
China | Media
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1661.HK WACC - Weighted Average Cost of Capital

The WACC of Wisdom Sports Group (1661.HK) is 6.1%.

The Cost of Equity of Wisdom Sports Group (1661.HK) is 6.15%.
The Cost of Debt of Wisdom Sports Group (1661.HK) is 7.00%.

Range Selected
Cost of equity 5.10% - 7.20% 6.15%
Tax rate 7.70% - 9.50% 8.60%
Cost of debt 7.00% - 7.00% 7.00%
WACC 5.2% - 7.1% 6.1%
WACC

1661.HK WACC calculation

Category Low High
Long-term bond rate 2.9% 3.4%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.37 0.47
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.10% 7.20%
Tax rate 7.70% 9.50%
Debt/Equity ratio 0.07 0.07
Cost of debt 7.00% 7.00%
After-tax WACC 5.2% 7.1%
Selected WACC 6.1%

1661.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 1661.HK:

cost_of_equity (6.15%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.37) + 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.