2608.HK WACC - Weighted Average Cost of Capital

The WACC of Sunshine 100 China Holdings Ltd (2608.HK) is 4.9%.

The Cost of Equity of Sunshine 100 China Holdings Ltd (2608.HK) is 91.85%.

The Cost of Debt of Sunshine 100 China Holdings Ltd (2608.HK) is 5.50%.

	Range	Selected
Cost of equity	32.80% - 150.90%	91.85%
Tax rate	6.70% - 15.90%	11.30%
Cost of debt	4.00% - 7.00%	5.50%
WACC	3.8% - 6.0%	4.9%

WACC

2608.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	5	21.07

Additional risk adjustments	0.0%	0.5%
Cost of equity	32.80%	150.90%

Tax rate	6.70%	15.90%
Debt/Equity ratio	961.49	961.49
Cost of debt	4.00%	7.00%

After-tax WACC	3.8%	6.0%


Selected WACC	4.9%

2608.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 2608.HK:

cost_of_equity (91.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (5) + 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.