216.HK WACC - Weighted Average Cost of Capital

The WACC of Chinney Investments Ltd (216.HK) is 9.4%.

The Cost of Equity of Chinney Investments Ltd (216.HK) is 8.05%.

The Cost of Debt of Chinney Investments Ltd (216.HK) is 12.15%.

	Range	Selected
Cost of equity	6.30% - 9.80%	8.05%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	4.40% - 19.90%	12.15%
WACC	3.5% - 15.2%	9.4%

WACC

216.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.57	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.30%	9.80%

Tax rate	22.10%	22.30%
Debt/Equity ratio	22.72	22.72
Cost of debt	4.40%	19.90%

After-tax WACC	3.5%	15.2%


Selected WACC	9.4%

216.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 216.HK:

cost_of_equity (8.05%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.57) + 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.