2669.HK WACC - Weighted Average Cost of Capital

The WACC of China Overseas Property Holdings Ltd (2669.HK) is 9.9%.

The Cost of Equity of China Overseas Property Holdings Ltd (2669.HK) is 10.00%.

The Cost of Debt of China Overseas Property Holdings Ltd (2669.HK) is 10.65%.

	Range	Selected
Cost of equity	8.60% - 11.40%	10.00%
Tax rate	24.20% - 24.60%	24.40%
Cost of debt	4.00% - 17.30%	10.65%
WACC	8.5% - 11.4%	9.9%

WACC

2669.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.95	1.07

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.60%	11.40%

Tax rate	24.20%	24.60%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	17.30%

After-tax WACC	8.5%	11.4%


Selected WACC	9.9%

2669.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 2669.HK:

cost_of_equity (10.00%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.95) + 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.