267.HK WACC - Weighted Average Cost of Capital
The WACC of CITIC Ltd (267.HK) is 5.6%.
| Range | Selected | |
| Cost of equity | 9.6% - 27.3% | 18.45% |
| Tax rate | 17.1% - 17.2% | 17.15% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.7% - 6.5% | 5.6% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 1.12 | 3.35 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.6% | 27.3% |
| Tax rate | 17.1% | 17.2% |
| Debt/Equity ratio | 8.86 | 8.86 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.7% | 6.5% |
| Selected WACC | 5.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 267.HK | CITIC Ltd | 8.86 | 0.99 | 0.12 |
| 000009.SZ | China Baoan Group Co Ltd | 0.98 | 1.31 | 0.73 |
| 000880.KS | Hanwha Corp | 10.61 | 0.86 | 0.09 |
| 2722.HK | Chongqing Machinery & Electric Co Ltd | 1.17 | 0.86 | 0.44 |
| 600668.SS | Zhe Jiang Jian Feng Group Co Ltd | 0.16 | 1.04 | 0.92 |
| 600805.SS | Jiangsu Yueda Investment Co Ltd | 0.79 | 1.15 | 0.7 |
| 600855.SS | Beijing Aerospace Changfeng Co Ltd | 0.06 | 1.54 | 1.46 |
| 601328.SS | Bank of Communications Co Ltd | 5.15 | 0.53 | 0.1 |
| 6502.T | Toshiba Corp | 0.2 | 0.05 | 0.05 |
| 656.HK | Fosun International Ltd | 6.92 | 1.05 | 0.16 |
| Low | High | |
| Unlevered beta | 0.14 | 0.54 |
| Relevered beta | 1.18 | 4.51 |
| Adjusted relevered beta | 1.12 | 3.35 |
267.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 267.HK:
cost_of_equity (18.45%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.12) + 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.