35.HK WACC - Weighted Average Cost of Capital

The WACC of Far East Consortium International Ltd (35.HK) is 10.1%.

The Cost of Equity of Far East Consortium International Ltd (35.HK) is 10.85%.

The Cost of Debt of Far East Consortium International Ltd (35.HK) is 14.45%.

	Range	Selected
Cost of equity	8.70% - 13.00%	10.85%
Tax rate	21.20% - 33.00%	27.10%
Cost of debt	6.00% - 22.90%	14.45%
WACC	5.0% - 15.2%	10.1%

WACC

35.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.98	1.31

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.70%	13.00%

Tax rate	21.20%	33.00%
Debt/Equity ratio	14.37	14.37
Cost of debt	6.00%	22.90%

After-tax WACC	5.0%	15.2%


Selected WACC	10.1%

35.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 35.HK:

cost_of_equity (10.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.98) + 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.