1966.HK WACC - Weighted Average Cost of Capital
The WACC of China SCE Group Holdings Ltd (1966.HK) is 5.1%.
| Range | Selected | |
| Cost of equity | 19.6% - 40.9% | 30.25% |
| Tax rate | 24.7% - 33.8% | 29.25% |
| Cost of debt | 6.6% - 7.0% | 6.8% |
| WACC | 5.2% - 5.1% | 5.1% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 2.81 | 5.31 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 19.6% | 40.9% |
| Tax rate | 24.7% | 33.8% |
| Debt/Equity ratio | 82.6 | 82.6 |
| Cost of debt | 6.6% | 7.0% |
| After-tax WACC | 5.2% | 5.1% |
| Selected WACC | 5.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1966.HK | China SCE Group Holdings Ltd | 82.6 | 3.05 | 0.05 |
| 000537.SZ | Tianjin Guangyu Development Co Ltd | 3.33 | 1.02 | 0.31 |
| 000540.SZ | Zhongtian Financial Group Co Ltd | 15.12 | 1.56 | 0.14 |
| 000732.SZ | Tahoe Group Co Ltd | 106.9 | 1.75 | 0.02 |
| 002244.SZ | Hangzhou Binjiang Real Estate Group Co Ltd | 2.16 | 1.24 | 0.5 |
| 1107.HK | Modern Land (China) Co Ltd | 409.05 | 0.21 | 0 |
| 1862.HK | Jingrui Holdings Ltd | 863.6 | 1.44 | 0 |
| 2868.HK | Beijing Capital Land Ltd | 9.23 | 0.85 | 0.12 |
| 600466.SS | Sichuan Languang Development Co Ltd | 52.59 | 1.09 | 0.03 |
| 600565.SS | DIMA HOLDINGS Co Ltd | 10.55 | 1.51 | 0.18 |
| 600823.SS | Shanghai Shimao Co Ltd | 17.49 | 1.13 | 0.09 |
| Low | High | |
| Unlevered beta | 0.05 | 0.12 |
| Relevered beta | 3.7 | 7.43 |
| Adjusted relevered beta | 2.81 | 5.31 |
1966.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 1966.HK:
cost_of_equity (30.25%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.81) + 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.