528.HK WACC - Weighted Average Cost of Capital
The WACC of Kingdom Holdings Ltd (528.HK) is 8.3%.
| Range | Selected | |
| Cost of equity | 12.1% - 15.9% | 14% |
| Tax rate | 26.4% - 26.6% | 26.5% |
| Cost of debt | 4.8% - 7.0% | 5.9% |
| WACC | 7.1% - 9.6% | 8.3% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 1.55 | 1.72 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 12.1% | 15.9% |
| Tax rate | 26.4% | 26.6% |
| Debt/Equity ratio | 1.42 | 1.42 |
| Cost of debt | 4.8% | 7.0% |
| After-tax WACC | 7.1% | 9.6% |
| Selected WACC | 8.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 528.HK | Kingdom Holdings Ltd | 1.42 | 0.01 | 0.01 |
| 002144.SZ | Hongda High-Tech Holding Co Ltd | 0.03 | 1.13 | 1.11 |
| 002193.SZ | Shandong Ruyi Woolen Garment Group Co Ltd | 0.79 | 1.11 | 0.7 |
| 002486.SZ | Shanghai Challenge Textile Co Ltd | 0.02 | 1.52 | 1.5 |
| 1400.HK | Moody Technology Holdings Ltd | 1.97 | 1.13 | 0.46 |
| 300218.SZ | Anhui Anli Material Technology Co Ltd | 0.12 | 1.28 | 1.17 |
| 600156.SS | Hunan Huasheng Co Ltd | 0.09 | 0.92 | 0.87 |
| 600232.SS | Zhejiang Golden Eagle Co Ltd | 0.19 | 1.03 | 0.91 |
| 600493.SS | Fujian Fynex Textile Science & Technology Co Ltd | 0.22 | 1.1 | 0.95 |
| 600689.SS | Shanghai Sanmao Enterprise Group Co Ltd | 0.01 | 1.16 | 1.15 |
| Low | High | |
| Unlevered beta | 0.89 | 1.01 |
| Relevered beta | 1.82 | 2.07 |
| Adjusted relevered beta | 1.55 | 1.72 |
528.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 528.HK:
cost_of_equity (14.00%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.55) + 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.