3329.HK WACC - Weighted Average Cost of Capital

The WACC of BOCOM International Holdings Co Ltd (3329.HK) is 13.0%.

The Cost of Equity of BOCOM International Holdings Co Ltd (3329.HK) is 10.25%.

The Cost of Debt of BOCOM International Holdings Co Ltd (3329.HK) is 13.45%.

	Range	Selected
Cost of equity	8.40% - 12.10%	10.25%
Tax rate	0.30% - 0.90%	0.60%
Cost of debt	4.00% - 22.90%	13.45%
WACC	4.4% - 21.6%	13.0%

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	0.93	1.17

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.40%	12.10%

Tax rate	0.30%	0.90%
Debt/Equity ratio	9.22	9.22
Cost of debt	4.00%	22.90%

After-tax WACC	4.4%	21.6%


Selected WACC	13.0%

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 (10.25%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.93) + 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.