1693.HK WACC - Weighted Average Cost of Capital

The WACC of BGMC International Ltd (1693.HK) is 9.4%.

The Cost of Equity of BGMC International Ltd (1693.HK) is 9.20%.

The Cost of Debt of BGMC International Ltd (1693.HK) is 12.00%.

	Range	Selected
Cost of equity	7.90% - 10.50%	9.20%
Tax rate	4.20% - 5.60%	4.90%
Cost of debt	11.40% - 12.60%	12.00%
WACC	8.1% - 10.6%	9.4%

WACC

1693.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.84	0.95

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.90%	10.50%

Tax rate	4.20%	5.60%
Debt/Equity ratio	0.08	0.08
Cost of debt	11.40%	12.60%

After-tax WACC	8.1%	10.6%


Selected WACC	9.4%

1693.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 1693.HK:

cost_of_equity (9.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.84) + 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.