2868.HK WACC - Weighted Average Cost of Capital

The WACC of Beijing Capital Land Ltd (2868.HK) is 11.0%.

The Cost of Equity of Beijing Capital Land Ltd (2868.HK) is 8.30%.

The Cost of Debt of Beijing Capital Land Ltd (2868.HK) is 15.50%.

	Range	Selected
Cost of equity	6.80% - 9.80%	8.30%
Tax rate	27.20% - 27.60%	27.40%
Cost of debt	10.50% - 20.50%	15.50%
WACC	7.6% - 14.3%	11.0%

WACC

2868.HK WACC calculation

Category	Low	High

Long-term bond rate	3.0%	3.5%
Equity market risk premium	5.3%	6.3%
Adjusted beta	0.71	0.91

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.80%	9.80%

Tax rate	27.20%	27.60%
Debt/Equity ratio	9.23	9.23
Cost of debt	10.50%	20.50%

After-tax WACC	7.6%	14.3%


Selected WACC	11.0%

2868.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 2868.HK:

cost_of_equity (8.30%) = risk_free_rate (3.25%) + equity_risk_premium (5.80%) * adjusted_beta (0.71) + 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.