6068.HK WACC - Weighted Average Cost of Capital

The WACC of Wisdom Education International Holdings Company Ltd (6068.HK) is 8.2%.

The Cost of Equity of Wisdom Education International Holdings Company Ltd (6068.HK) is 14.15%.

The Cost of Debt of Wisdom Education International Holdings Company Ltd (6068.HK) is 4.25%.

	Range	Selected
Cost of equity	11.20% - 17.10%	14.15%
Tax rate	13.40% - 15.50%	14.45%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.8% - 9.5%	8.2%

WACC

6068.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.4	1.89

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.20%	17.10%

Tax rate	13.40%	15.50%
Debt/Equity ratio	1.32	1.32
Cost of debt	4.00%	4.50%

After-tax WACC	6.8%	9.5%


Selected WACC	8.2%

6068.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 6068.HK:

cost_of_equity (14.15%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.4) + 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.