2183.HK WACC - Weighted Average Cost of Capital

The WACC of Sansheng Holdings Group Co Ltd (2183.HK) is 10.0%.

The Cost of Equity of Sansheng Holdings Group Co Ltd (2183.HK) is 10.65%.

The Cost of Debt of Sansheng Holdings Group Co Ltd (2183.HK) is 12.85%.

	Range	Selected
Cost of equity	7.90% - 13.40%	10.65%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	5.80% - 19.90%	12.85%
WACC	4.9% - 15.2%	10.0%

WACC

2183.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.84	1.37

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.90%	13.40%

Tax rate	22.10%	22.30%
Debt/Equity ratio	9.05	9.05
Cost of debt	5.80%	19.90%

After-tax WACC	4.9%	15.2%


Selected WACC	10.0%

2183.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 2183.HK:

cost_of_equity (10.65%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.84) + 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.