510.HK WACC - Weighted Average Cost of Capital

The WACC of CASH Financial Services Group Ltd (510.HK) is 7.0%.

The Cost of Equity of CASH Financial Services Group Ltd (510.HK) is 7.30%.

The Cost of Debt of CASH Financial Services Group Ltd (510.HK) is 6.75%.

	Range	Selected
Cost of equity	5.50% - 9.10%	7.30%
Tax rate	1.70% - 3.90%	2.80%
Cost of debt	6.50% - 7.00%	6.75%
WACC	5.9% - 8.0%	7.0%

WACC

510.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.44	0.75

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.50%	9.10%

Tax rate	1.70%	3.90%
Debt/Equity ratio	0.91	0.91
Cost of debt	6.50%	7.00%

After-tax WACC	5.9%	8.0%


Selected WACC	7.0%

510.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 510.HK:

cost_of_equity (7.30%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.44) + 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.