41.HK WACC - Weighted Average Cost of Capital

The WACC of Great Eagle Holdings Ltd (41.HK) is 4.8%.

The Cost of Equity of Great Eagle Holdings Ltd (41.HK) is 9.20%.

The Cost of Debt of Great Eagle Holdings Ltd (41.HK) is 6.05%.

	Range	Selected
Cost of equity	6.30% - 12.10%	9.20%
Tax rate	35.40% - 48.10%	41.75%
Cost of debt	4.00% - 8.10%	6.05%
WACC	3.5% - 6.0%	4.8%

WACC

41.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.58	1.18

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.30%	12.10%

Tax rate	35.40%	48.10%
Debt/Equity ratio	3.27	3.27
Cost of debt	4.00%	8.10%

After-tax WACC	3.5%	6.0%


Selected WACC	4.8%

41.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 41.HK:

cost_of_equity (9.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.58) + 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.