2326.HK WACC - Weighted Average Cost of Capital
The WACC of New Provenance Everlasting Holdings Ltd (2326.HK) is 6.4%.
| Range | Selected | |
| Cost of equity | 5.1% - 7.9% | 6.5% |
| Tax rate | 23.7% - 39.6% | 31.65% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.1% - 7.8% | 6.4% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.37 | 0.58 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.1% | 7.9% |
| Tax rate | 23.7% | 39.6% |
| Debt/Equity ratio | 0.02 | 0.02 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.1% | 7.8% |
| Selected WACC | 6.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 2326.HK | New Provenance Everlasting Holdings Ltd | 0.02 | 0.86 | 0.85 |
| 1130.HK | China Environmental Resources Group Ltd | 1.11 | 1.05 | 0.58 |
| 1539.HK | Synergy Group Holdings International Ltd | 0.08 | 0.2 | 0.19 |
| 380.HK | Softpower International Ltd | 0.61 | 1.05 | 0.72 |
| 387.HK | Leeport (Holdings) Ltd | 0.78 | -0.01 | -0.01 |
| 599.HK | E.Bon Holdings Ltd | 0.65 | 0.12 | 0.08 |
| 7.HK | Hong Kong Finance Investment Holding Group Ltd | 4.7 | -0.16 | -0.04 |
| 8009.HK | Chinese Energy Holdings Ltd | 0.02 | 0.64 | 0.63 |
| 8162.HK | Loco Hong Kong Holdings Ltd | 0.06 | -0.01 | -0.01 |
| 997.HK | Chinlink International Holdings Ltd | 55.95 | 1.44 | 0.03 |
| Low | High | |
| Unlevered beta | 0.06 | 0.34 |
| Relevered beta | 0.06 | 0.37 |
| Adjusted relevered beta | 0.37 | 0.58 |
2326.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 2326.HK:
cost_of_equity (6.50%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.37) + 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.