312.HK WACC - Weighted Average Cost of Capital

The WACC of Shirble Department Store Holdings China Ltd (312.HK) is 9.4%.

The Cost of Equity of Shirble Department Store Holdings China Ltd (312.HK) is 41.65%.

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

	Range	Selected
Cost of equity	36.00% - 47.30%	41.65%
Tax rate	15.60% - 36.80%	26.20%
Cost of debt	5.40% - 11.40%	8.40%
WACC	7.7% - 11.2%	9.4%

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	5.54	6.22

Additional risk adjustments	0.0%	0.5%
Cost of equity	36.00%	47.30%

Tax rate	15.60%	36.80%
Debt/Equity ratio	9	9
Cost of debt	5.40%	11.40%

After-tax WACC	7.7%	11.2%


Selected WACC	9.4%

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 (41.65%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (5.54) + 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.