1736.HK WACC - Weighted Average Cost of Capital

The WACC of China Parenting Network Holdings Ltd (1736.HK) is 7.9%.

The Cost of Equity of China Parenting Network Holdings Ltd (1736.HK) is 11.90%.

The Cost of Debt of China Parenting Network Holdings Ltd (1736.HK) is 5.50%.

	Range	Selected
Cost of equity	9.70% - 14.10%	11.90%
Tax rate	0.40% - 0.80%	0.60%
Cost of debt	4.00% - 7.00%	5.50%
WACC	6.2% - 9.6%	7.9%

WACC

1736.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.15	1.47

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.70%	14.10%

Tax rate	0.40%	0.80%
Debt/Equity ratio	1.66	1.66
Cost of debt	4.00%	7.00%

After-tax WACC	6.2%	9.6%


Selected WACC	7.9%

1736.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 1736.HK:

cost_of_equity (11.90%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.15) + 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.