3939.HK WACC - Weighted Average Cost of Capital

The WACC of Wanguo International Mining Group Ltd (3939.HK) is 9.8%.

The Cost of Equity of Wanguo International Mining Group Ltd (3939.HK) is 9.90%.

The Cost of Debt of Wanguo International Mining Group Ltd (3939.HK) is 5.10%.

	Range	Selected
Cost of equity	8.40% - 11.40%	9.90%
Tax rate	15.20% - 16.60%	15.90%
Cost of debt	4.00% - 6.20%	5.10%
WACC	8.4% - 11.3%	9.8%

WACC

3939.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.93	1.07

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.40%	11.40%

Tax rate	15.20%	16.60%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	6.20%

After-tax WACC	8.4%	11.3%


Selected WACC	9.8%

3939.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 3939.HK:

cost_of_equity (9.90%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.93) + 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.