2001.HK
China New Higher Education Group Ltd
Price:  
0.90 
HKD
Volume:  
7,007,000.00
China | Diversified Consumer Services
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2001.HK WACC - Weighted Average Cost of Capital

The WACC of China New Higher Education Group Ltd (2001.HK) is 7.9%.

The Cost of Equity of China New Higher Education Group Ltd (2001.HK) is 15.65%.
The Cost of Debt of China New Higher Education Group Ltd (2001.HK) is 5.05%.

Range Selected
Cost of equity 11.80% - 19.50% 15.65%
Tax rate 14.50% - 16.20% 15.35%
Cost of debt 4.00% - 6.10% 5.05%
WACC 6.1% - 9.7% 7.9%
WACC

2001.HK WACC calculation

Category Low High
Long-term bond rate 2.9% 3.4%
Equity market risk premium 6.0% 7.0%
Adjusted beta 1.49 2.25
Additional risk adjustments 0.0% 0.5%
Cost of equity 11.80% 19.50%
Tax rate 14.50% 16.20%
Debt/Equity ratio 2.1 2.1
Cost of debt 4.00% 6.10%
After-tax WACC 6.1% 9.7%
Selected WACC 7.9%

2001.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 2001.HK:

cost_of_equity (15.65%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.49) + 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.