355.HK WACC - Weighted Average Cost of Capital

The WACC of Century City International Holdings Ltd (355.HK) is 5.2%.

The Cost of Equity of Century City International Holdings Ltd (355.HK) is 18.40%.

The Cost of Debt of Century City International Holdings Ltd (355.HK) is 5.80%.

	Range	Selected
Cost of equity	12.40% - 24.40%	18.40%
Tax rate	2.20% - 17.90%	10.05%
Cost of debt	4.60% - 7.00%	5.80%
WACC	4.5% - 5.9%	5.2%

WACC

355.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.59	2.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.40%	24.40%

Tax rate	2.20%	17.90%
Debt/Equity ratio	172.76	172.76
Cost of debt	4.60%	7.00%

After-tax WACC	4.5%	5.9%


Selected WACC	5.2%

355.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 355.HK:

cost_of_equity (18.40%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.59) + 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.