2233.HK WACC - Weighted Average Cost of Capital

The WACC of West China Cement Ltd (2233.HK) is 9.6%.

The Cost of Equity of West China Cement Ltd (2233.HK) is 12.35%.

The Cost of Debt of West China Cement Ltd (2233.HK) is 8.80%.

	Range	Selected
Cost of equity	10.80% - 13.90%	12.35%
Tax rate	14.40% - 18.30%	16.35%
Cost of debt	6.50% - 11.10%	8.80%
WACC	7.9% - 11.2%	9.6%

WACC

2233.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.33	1.44

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.80%	13.90%

Tax rate	14.40%	18.30%
Debt/Equity ratio	1.25	1.25
Cost of debt	6.50%	11.10%

After-tax WACC	7.9%	11.2%


Selected WACC	9.6%

2233.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 2233.HK:

cost_of_equity (12.35%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.33) + 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.