174.HK WACC - Weighted Average Cost of Capital

The WACC of Gemini Investments Holdings Ltd (174.HK) is 7.9%.

The Cost of Equity of Gemini Investments Holdings Ltd (174.HK) is 43.25%.

The Cost of Debt of Gemini Investments Holdings Ltd (174.HK) is 8.40%.

	Range	Selected
Cost of equity	18.70% - 67.80%	43.25%
Tax rate	14.20% - 21.50%	17.85%
Cost of debt	5.40% - 11.40%	8.40%
WACC	5.1% - 10.7%	7.9%

WACC

174.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	2.65	9.16

Additional risk adjustments	0.0%	0.5%
Cost of equity	18.70%	67.80%

Tax rate	14.20%	21.50%
Debt/Equity ratio	31.85	31.85
Cost of debt	5.40%	11.40%

After-tax WACC	5.1%	10.7%


Selected WACC	7.9%

174.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 174.HK:

cost_of_equity (43.25%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.65) + 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.