50.HK WACC - Weighted Average Cost of Capital

The WACC of Hong Kong Ferry Holdings Co Ltd (50.HK) is 6.5%.

The Cost of Equity of Hong Kong Ferry Holdings Co Ltd (50.HK) is 6.50%.

The Cost of Debt of Hong Kong Ferry Holdings Co Ltd (50.HK) is 4.25%.

	Range	Selected
Cost of equity	5.40% - 7.60%	6.50%
Tax rate	9.60% - 11.90%	10.75%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.3% - 7.6%	6.5%

WACC

50.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.42	0.54

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.40%	7.60%

Tax rate	9.60%	11.90%
Debt/Equity ratio	0	0
Cost of debt	4.00%	4.50%

After-tax WACC	5.3%	7.6%


Selected WACC	6.5%

50.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 50.HK:

cost_of_equity (6.50%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.42) + 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.