3399.HK WACC - Weighted Average Cost of Capital

The WACC of Guangdong Yueyun Transportation Co Ltd (3399.HK) is 6.9%.

The Cost of Equity of Guangdong Yueyun Transportation Co Ltd (3399.HK) is 18.80%.

The Cost of Debt of Guangdong Yueyun Transportation Co Ltd (3399.HK) is 5.00%.

	Range	Selected
Cost of equity	16.40% - 21.20%	18.80%
Tax rate	30.60% - 32.70%	31.65%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.4% - 7.4%	6.9%

WACC

3399.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	2.27	2.48

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.40%	21.20%

Tax rate	30.60%	32.70%
Debt/Equity ratio	3.39	3.39
Cost of debt	5.00%	5.00%

After-tax WACC	6.4%	7.4%


Selected WACC	6.9%

3399.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 3399.HK:

cost_of_equity (18.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.27) + 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.