3366.HK WACC - Weighted Average Cost of Capital

The WACC of Overseas Chinese Town (Asia) Holdings Ltd (3366.HK) is 6.7%.

The Cost of Equity of Overseas Chinese Town (Asia) Holdings Ltd (3366.HK) is 80.95%.

The Cost of Debt of Overseas Chinese Town (Asia) Holdings Ltd (3366.HK) is 7.10%.

	Range	Selected
Cost of equity	59.10% - 102.80%	80.95%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	6.10% - 8.10%	7.10%
WACC	5.6% - 7.9%	6.7%

WACC

3366.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	9.4	14.18

Additional risk adjustments	0.0%	0.5%
Cost of equity	59.10%	102.80%

Tax rate	22.10%	22.30%
Debt/Equity ratio	60.47	60.47
Cost of debt	6.10%	8.10%

After-tax WACC	5.6%	7.9%


Selected WACC	6.7%

3366.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 3366.HK:

cost_of_equity (80.95%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (9.4) + 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.