3690.HK
Meituan
Price:  
125.5 
HKD
Volume:  
40,731,440
China | Internet & Direct Marketing Retail

3690.HK WACC - Weighted Average Cost of Capital

The WACC of Meituan (3690.HK) is 9.1%.

The Cost of Equity of Meituan (3690.HK) is 9.55%.
The Cost of Debt of Meituan (3690.HK) is 4.25%.

RangeSelected
Cost of equity6.8% - 12.3%9.55%
Tax rate1.1% - 3.0%2.05%
Cost of debt4.0% - 4.5%4.25%
WACC6.5% - 11.7%9.1%
WACC

3690.HK WACC calculation

CategoryLowHigh
Long-term bond rate2.9%3.4%
Equity market risk premium6.0%7.0%
Adjusted beta0.651.21
Additional risk adjustments0.0%0.5%
Cost of equity6.8%12.3%
Tax rate1.1%3.0%
Debt/Equity ratio
0.090.09
Cost of debt4.0%4.5%
After-tax WACC6.5%11.7%
Selected WACC9.1%

3690.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 3690.HK:

cost_of_equity (9.55%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.65) + 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.