1813.HK WACC - Weighted Average Cost of Capital

The WACC of KWG Group Holdings Ltd (1813.HK) is 5.4%.

The Cost of Equity of KWG Group Holdings Ltd (1813.HK) is 30.20%.

The Cost of Debt of KWG Group Holdings Ltd (1813.HK) is 5.95%.

	Range	Selected
Cost of equity	18.40% - 42.00%	30.20%
Tax rate	7.90% - 18.30%	13.10%
Cost of debt	4.90% - 7.00%	5.95%
WACC	4.7% - 6.2%	5.4%

WACC

1813.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	2.59	5.47

Additional risk adjustments	0.0%	0.5%
Cost of equity	18.40%	42.00%

Tax rate	7.90%	18.30%
Debt/Equity ratio	75.19	75.19
Cost of debt	4.90%	7.00%

After-tax WACC	4.7%	6.2%


Selected WACC	5.4%

1813.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 1813.HK:

cost_of_equity (30.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.59) + 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.