312.HK WACC - Weighted Average Cost of Capital

The WACC of Shirble Department Store Holdings China Ltd (312.HK) is 9.5%.

The Cost of Equity of Shirble Department Store Holdings China Ltd (312.HK) is 43.20%.

The Cost of Debt of Shirble Department Store Holdings China Ltd (312.HK) is 8.40%.

	Range	Selected
Cost of equity	37.30% - 49.10%	43.20%
Tax rate	15.60% - 36.80%	26.20%
Cost of debt	5.40% - 11.40%	8.40%
WACC	7.7% - 11.2%	9.5%

WACC

312.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	5.76	6.48

Additional risk adjustments	0.0%	0.5%
Cost of equity	37.30%	49.10%

Tax rate	15.60%	36.80%
Debt/Equity ratio	9.4	9.4
Cost of debt	5.40%	11.40%

After-tax WACC	7.7%	11.2%


Selected WACC	9.5%

312.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 312.HK:

cost_of_equity (43.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (5.76) + 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.