1752.HK WACC - Weighted Average Cost of Capital
The WACC of Top Education Group Ltd (1752.HK) is 6.9%.
| Range | Selected | |
| Cost of equity | 6.9% - 10.6% | 8.75% |
| Tax rate | 29.6% - 33.5% | 31.55% |
| Cost of debt | 4.3% - 6.5% | 5.4% |
| WACC | 5.5% - 8.4% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.67 | 0.97 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.9% | 10.6% |
| Tax rate | 29.6% | 33.5% |
| Debt/Equity ratio | 0.55 | 0.55 |
| Cost of debt | 4.3% | 6.5% |
| After-tax WACC | 5.5% | 8.4% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1752.HK | Top Education Group Ltd | 0.55 | -0.38 | -0.27 |
| 1756.HK | Huali University Group Ltd | 3.43 | 0.28 | 0.08 |
| 4292.SR | Ataa Educational Co | 0.4 | 0.87 | 0.68 |
| AKG.AX | Academies Australasia Group Ltd | 2.79 | 0.23 | 0.08 |
| ICT.AX | iCollege Ltd | 0.16 | -0.28 | -0.25 |
| IEL.AX | IDP Education Ltd | 0.1 | 1.03 | 0.97 |
| KME.AX | Kip McGrath Education Centres Ltd | 0.15 | 0.61 | 0.55 |
| RDH.AX | Redhill Education Ltd | 0.34 | 1.22 | 0.98 |
| SIT.AX | Site Group International Ltd | 0.41 | 1.14 | 0.88 |
| UCW.AX | UCW Ltd | 0.73 | 1.04 | 0.69 |
| Low | High | |
| Unlevered beta | 0.37 | 0.68 |
| Relevered beta | 0.51 | 0.96 |
| Adjusted relevered beta | 0.67 | 0.97 |
1752.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 1752.HK:
cost_of_equity (8.75%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.67) + 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.