1901.HK WACC - Weighted Average Cost of Capital

The WACC of Feiyang International Holdings Group Ltd (1901.HK) is 10.0%.

The Cost of Equity of Feiyang International Holdings Group Ltd (1901.HK) is 24.75%.

The Cost of Debt of Feiyang International Holdings Group Ltd (1901.HK) is 5.75%.

	Range	Selected
Cost of equity	21.10% - 28.40%	24.75%
Tax rate	2.00% - 8.80%	5.40%
Cost of debt	4.50% - 7.00%	5.75%
WACC	8.4% - 11.6%	10.0%

WACC

1901.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	3.05	3.52

Additional risk adjustments	0.0%	0.5%
Cost of equity	21.10%	28.40%

Tax rate	2.00%	8.80%
Debt/Equity ratio	3.19	3.19
Cost of debt	4.50%	7.00%

After-tax WACC	8.4%	11.6%


Selected WACC	10.0%

1901.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 1901.HK:

cost_of_equity (24.75%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (3.05) + 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.