513.HK WACC - Weighted Average Cost of Capital

The WACC of Continental Holdings Ltd (513.HK) is 10.8%.

The Cost of Equity of Continental Holdings Ltd (513.HK) is 19.10%.

The Cost of Debt of Continental Holdings Ltd (513.HK) is 13.45%.

	Range	Selected
Cost of equity	16.90% - 21.30%	19.10%
Tax rate	8.10% - 28.70%	18.40%
Cost of debt	4.00% - 22.90%	13.45%
WACC	4.9% - 16.7%	10.8%

WACC

513.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	2.34	2.49

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.90%	21.30%

Tax rate	8.10%	28.70%
Debt/Equity ratio	10	10
Cost of debt	4.00%	22.90%

After-tax WACC	4.9%	16.7%


Selected WACC	10.8%

513.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 513.HK:

cost_of_equity (19.10%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.34) + 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.