3329.HK WACC - Weighted Average Cost of Capital

The WACC of BOCOM International Holdings Co Ltd (3329.HK) is 5.9%.

The Cost of Equity of BOCOM International Holdings Co Ltd (3329.HK) is 14.85%.

The Cost of Debt of BOCOM International Holdings Co Ltd (3329.HK) is 5.50%.

	Range	Selected
Cost of equity	10.20% - 19.50%	14.85%
Tax rate	1.10% - 4.10%	2.60%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.3% - 7.4%	5.9%

WACC

3329.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.23	2.24

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.20%	19.50%

Tax rate	1.10%	4.10%
Debt/Equity ratio	16.28	16.28
Cost of debt	4.00%	7.00%

After-tax WACC	4.3%	7.4%


Selected WACC	5.9%

3329.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 3329.HK:

cost_of_equity (14.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.23) + 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.