1900.HK WACC - Weighted Average Cost of Capital

The WACC of China ITS Holdings Co Ltd (1900.HK) is 9.8%.

The Cost of Equity of China ITS Holdings Co Ltd (1900.HK) is 14.90%.

The Cost of Debt of China ITS Holdings Co Ltd (1900.HK) is 4.25%.

	Range	Selected
Cost of equity	12.60% - 17.20%	14.90%
Tax rate	13.10% - 19.90%	16.50%
Cost of debt	4.00% - 4.50%	4.25%
WACC	8.5% - 11.1%	9.8%

WACC

1900.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.62	1.91

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.60%	17.20%

Tax rate	13.10%	19.90%
Debt/Equity ratio	0.82	0.82
Cost of debt	4.00%	4.50%

After-tax WACC	8.5%	11.1%


Selected WACC	9.8%

1900.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 1900.HK:

cost_of_equity (14.90%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.62) + 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.