1680.HK WACC - Weighted Average Cost of Capital

The WACC of Macau Legend Development Ltd (1680.HK) is 6.3%.

The Cost of Equity of Macau Legend Development Ltd (1680.HK) is 10.30%.

The Cost of Debt of Macau Legend Development Ltd (1680.HK) is 5.85%.

	Range	Selected
Cost of equity	6.00% - 14.60%	10.30%
Tax rate	6.30% - 11.80%	9.05%
Cost of debt	4.70% - 7.00%	5.85%
WACC	4.8% - 7.8%	6.3%

WACC

1680.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.53	1.54

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.00%	14.60%

Tax rate	6.30%	11.80%
Debt/Equity ratio	4.06	4.06
Cost of debt	4.70%	7.00%

After-tax WACC	4.8%	7.8%


Selected WACC	6.3%

1680.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 1680.HK:

cost_of_equity (10.30%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.53) + 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.