171.HK WACC - Weighted Average Cost of Capital

The WACC of Silver Grant International Holdings Group Ltd (171.HK) is 14.1%.

The Cost of Equity of Silver Grant International Holdings Group Ltd (171.HK) is 7.10%.

The Cost of Debt of Silver Grant International Holdings Group Ltd (171.HK) is 14.60%.

	Range	Selected
Cost of equity	5.20% - 9.00%	7.10%
Tax rate	2.00% - 2.70%	2.35%
Cost of debt	6.30% - 22.90%	14.60%
WACC	6.2% - 21.9%	14.1%

WACC

171.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.31	0.67

Additional risk adjustments	0.5%	1.0%
Cost of equity	5.20%	9.00%

Tax rate	2.00%	2.70%
Debt/Equity ratio	40.55	40.55
Cost of debt	6.30%	22.90%

After-tax WACC	6.2%	21.9%


Selected WACC	14.1%

171.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 171.HK:

cost_of_equity (7.10%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.31) + risk_adjustments (0.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.