2231.HK WACC - Weighted Average Cost of Capital

The WACC of JY Grandmark Holdings Ltd (2231.HK) is 7.6%.

The Cost of Equity of JY Grandmark Holdings Ltd (2231.HK) is 11.00%.

The Cost of Debt of JY Grandmark Holdings Ltd (2231.HK) is 10.50%.

	Range	Selected
Cost of equity	6.20% - 15.80%	11.00%
Tax rate	29.00% - 41.50%	35.25%
Cost of debt	6.40% - 14.60%	10.50%
WACC	5.0% - 10.3%	7.6%

WACC

2231.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.55	1.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.20%	15.80%

Tax rate	29.00%	41.50%
Debt/Equity ratio	3.21	3.21
Cost of debt	6.40%	14.60%

After-tax WACC	5.0%	10.3%


Selected WACC	7.6%

2231.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 2231.HK:

cost_of_equity (11.00%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.55) + 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.