456.HK
New City Development Group Ltd
Price:  
0.42 
HKD
Volume:  
4,000
Hong Kong | Real Estate Management & Development

456.HK WACC - Weighted Average Cost of Capital

The WACC of New City Development Group Ltd (456.HK) is 7.6%.

The Cost of Equity of New City Development Group Ltd (456.HK) is 6.8%.
The Cost of Debt of New City Development Group Ltd (456.HK) is 7.85%.

RangeSelected
Cost of equity5.7% - 7.9%6.8%
Tax rate1.3% - 4.1%2.7%
Cost of debt7.0% - 8.7%7.85%
WACC6.8% - 8.3%7.6%
WACC

456.HK WACC calculation

CategoryLowHigh
Long-term bond rate2.9%3.4%
Equity market risk premium6.0%7.0%
Adjusted beta0.470.58
Additional risk adjustments0.0%0.5%
Cost of equity5.7%7.9%
Tax rate1.3%4.1%
Debt/Equity ratio
11.6111.61
Cost of debt7.0%8.7%
After-tax WACC6.8%8.3%
Selected WACC7.6%

456.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 456.HK:

cost_of_equity (6.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.47) + 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.