2858.HK WACC - Weighted Average Cost of Capital

The WACC of Yixin Group Ltd (2858.HK) is 7.8%.

The Cost of Equity of Yixin Group Ltd (2858.HK) is 7.70%.

The Cost of Debt of Yixin Group Ltd (2858.HK) is 10.15%.

	Range	Selected
Cost of equity	6.40% - 9.00%	7.70%
Tax rate	22.40% - 24.00%	23.20%
Cost of debt	5.70% - 14.60%	10.15%
WACC	5.1% - 10.4%	7.8%

WACC

2858.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.58	0.74

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.40%	9.00%

Tax rate	22.40%	24.00%
Debt/Equity ratio	1.89	1.89
Cost of debt	5.70%	14.60%

After-tax WACC	5.1%	10.4%


Selected WACC	7.8%

2858.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 2858.HK:

cost_of_equity (7.70%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.58) + 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.