563.HK WACC - Weighted Average Cost of Capital
The WACC of Shanghai Industrial Urban Development Group Ltd (563.HK) is 5.1%.
| Range | Selected | |
| Cost of equity | 8.3% - 16.3% | 12.3% |
| Tax rate | 22.1% - 22.3% | 22.2% |
| Cost of debt | 5.2% - 6.5% | 5.85% |
| WACC | 4.4% - 5.9% | 5.1% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.91 | 1.78 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.3% | 16.3% |
| Tax rate | 22.1% | 22.3% |
| Debt/Equity ratio | 11.74 | 11.74 |
| Cost of debt | 5.2% | 6.5% |
| After-tax WACC | 4.4% | 5.9% |
| Selected WACC | 5.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 563.HK | Shanghai Industrial Urban Development Group Ltd | 11.74 | 0.86 | 0.08 |
| 1240.HK | CNQC International Holdings Ltd | 13.21 | 0.3 | 0.03 |
| 1278.HK | China New Town Development Co Ltd | 2.52 | 1 | 0.34 |
| 185.HK | Zensun Enterprises Ltd | 97.36 | 0.16 | 0 |
| 190.HK | HKC (Holdings) Ltd | 0.85 | 0.91 | 0.55 |
| 208.HK | Polytec Asset Holdings Ltd | 0.28 | 0.69 | 0.56 |
| 258.HK | Tomson Group Ltd | 0.16 | 0.45 | 0.4 |
| 34.HK | Kowloon Development Co Ltd | 5.28 | 0.67 | 0.13 |
| 845.HK | Glorious Property Holdings Ltd | 318.64 | 1.36 | 0.01 |
| 95.HK | LVGEM (China) Real Estate Investment Co Ltd | 27.66 | 1.91 | 0.08 |
| Low | High | |
| Unlevered beta | 0.08 | 0.21 |
| Relevered beta | 0.87 | 2.16 |
| Adjusted relevered beta | 0.91 | 1.78 |
563.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 563.HK:
cost_of_equity (12.30%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.91) + 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.