1899.HK WACC - Weighted Average Cost of Capital

The WACC of Xingda International Holdings Ltd (1899.HK) is 5.6%.

The Cost of Equity of Xingda International Holdings Ltd (1899.HK) is 11.80%.

The Cost of Debt of Xingda International Holdings Ltd (1899.HK) is 5.25%.

	Range	Selected
Cost of equity	8.40% - 15.20%	11.80%
Tax rate	25.40% - 26.10%	25.75%
Cost of debt	4.00% - 6.50%	5.25%
WACC	4.2% - 7.1%	5.6%

WACC

1899.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.93	1.63

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.40%	15.20%

Tax rate	25.40%	26.10%
Debt/Equity ratio	3.53	3.53
Cost of debt	4.00%	6.50%

After-tax WACC	4.2%	7.1%


Selected WACC	5.6%

1899.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 1899.HK:

cost_of_equity (11.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.93) + 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.