2051.HK WACC - Weighted Average Cost of Capital
The WACC of 51 Credit Card Inc (2051.HK) is 5.7%.
| Range | Selected | |
| Cost of equity | 5.1% - 6.6% | 5.85% |
| Tax rate | 13.4% - 21.4% | 17.4% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 4.9% - 6.5% | 5.7% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.38 | 0.4 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.1% | 6.6% |
| Tax rate | 13.4% | 21.4% |
| Debt/Equity ratio | 0.12 | 0.12 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 4.9% | 6.5% |
| Selected WACC | 5.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 2051.HK | 51 Credit Card Inc | 0.12 | 0.85 | 0.78 |
| 1290.HK | China Huirong Financial Holdings Ltd | 1.8 | -0.1 | -0.04 |
| 1543.HK | Guangdong Join-Share Financing Guarantee Investment Co Ltd | 1.91 | 0.48 | 0.19 |
| 1915.HK | Yangzhou Guangling District Taihe Rural Micro-finance Co Ltd | 0.01 | -0.32 | -0.32 |
| 2003.HK | VCREDIT Holdings Ltd | 3.12 | 0.21 | 0.06 |
| 2718.HK | Shanghai Dongzheng Automotive Finance Co Ltd | 0.61 | 0.3 | 0.2 |
| 600599.SS | Panda Financial Holding Corp Ltd | 0.06 | -0.26 | -0.25 |
| 6866.HK | Zuoli Kechuang Micro-finance Co Ltd | 1.62 | 0.23 | 0.1 |
| AEONCR.KL | AEON Credit Service (M) Bhd | 4.12 | 0.3 | 0.07 |
| HUM.AX | Humm Group Ltd | 15.33 | 1.12 | 0.08 |
| Low | High | |
| Unlevered beta | 0.07 | 0.09 |
| Relevered beta | 0.07 | 0.1 |
| Adjusted relevered beta | 0.38 | 0.4 |
2051.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 2051.HK:
cost_of_equity (5.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.38) + 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.