1921.HK WACC - Weighted Average Cost of Capital

The WACC of Dalipal Holdings Ltd (1921.HK) is 7.7%.

The Cost of Equity of Dalipal Holdings Ltd (1921.HK) is 8.25%.

The Cost of Debt of Dalipal Holdings Ltd (1921.HK) is 6.00%.

	Range	Selected
Cost of equity	6.80% - 9.70%	8.25%
Tax rate	13.30% - 15.30%	14.30%
Cost of debt	5.00% - 7.00%	6.00%
WACC	6.3% - 9.0%	7.7%

WACC

1921.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.66	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.80%	9.70%

Tax rate	13.30%	15.30%
Debt/Equity ratio	0.24	0.24
Cost of debt	5.00%	7.00%

After-tax WACC	6.3%	9.0%


Selected WACC	7.7%

1921.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 1921.HK:

cost_of_equity (8.25%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.66) + 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.