2282.HK WACC - Weighted Average Cost of Capital

The WACC of MGM China Holdings Ltd (2282.HK) is 8.6%.

The Cost of Equity of MGM China Holdings Ltd (2282.HK) is 10.65%.

The Cost of Debt of MGM China Holdings Ltd (2282.HK) is 5.05%.

	Range	Selected
Cost of equity	9.00% - 12.30%	10.65%
Tax rate	0.40% - 0.80%	0.60%
Cost of debt	4.30% - 5.80%	5.05%
WACC	7.3% - 10.0%	8.6%

WACC

2282.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.03	1.21

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.00%	12.30%

Tax rate	0.40%	0.80%
Debt/Equity ratio	0.57	0.57
Cost of debt	4.30%	5.80%

After-tax WACC	7.3%	10.0%


Selected WACC	8.6%

2282.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 2282.HK:

cost_of_equity (10.65%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.03) + 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.