171.HK WACC - Weighted Average Cost of Capital

The WACC of Silver Grant International Holdings Group Ltd (171.HK) is 15.4%.

The Cost of Equity of Silver Grant International Holdings Group Ltd (171.HK) is 8.05%.

The Cost of Debt of Silver Grant International Holdings Group Ltd (171.HK) is 16.10%.

	Range	Selected
Cost of equity	5.70% - 10.40%	8.05%
Tax rate	1.30% - 1.90%	1.60%
Cost of debt	9.30% - 22.90%	16.10%
WACC	9.0% - 21.8%	15.4%

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	0.48	0.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.70%	10.40%

Tax rate	1.30%	1.90%
Debt/Equity ratio	17.31	17.31
Cost of debt	9.30%	22.90%

After-tax WACC	9.0%	21.8%


Selected WACC	15.4%

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 (8.05%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.48) + 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.