2142.HK WACC - Weighted Average Cost of Capital

The WACC of Hbm Holdings Ltd (2142.HK) is 9.7%.

The Cost of Equity of Hbm Holdings Ltd (2142.HK) is 9.75%.

The Cost of Debt of Hbm Holdings Ltd (2142.HK) is 7.10%.

	Range	Selected
Cost of equity	7.70% - 11.80%	9.75%
Tax rate	0.10% - 0.30%	0.20%
Cost of debt	6.50% - 7.70%	7.10%
WACC	7.7% - 11.8%	9.7%

WACC

2142.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.81	1.14

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.70%	11.80%

Tax rate	0.10%	0.30%
Debt/Equity ratio	0.01	0.01
Cost of debt	6.50%	7.70%

After-tax WACC	7.7%	11.8%


Selected WACC	9.7%

2142.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 2142.HK:

cost_of_equity (9.75%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.81) + 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.