6068.HK WACC - Weighted Average Cost of Capital

The WACC of Wisdom Education International Holdings Company Ltd (6068.HK) is 8.0%.

The Cost of Equity of Wisdom Education International Holdings Company Ltd (6068.HK) is 13.20%.

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

	Range	Selected
Cost of equity	10.60% - 15.80%	13.20%
Tax rate	13.40% - 15.50%	14.45%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.7% - 9.3%	8.0%

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	1.3	1.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.60%	15.80%

Tax rate	13.40%	15.50%
Debt/Equity ratio	1.19	1.19
Cost of debt	4.00%	4.50%

After-tax WACC	6.7%	9.3%


Selected WACC	8.0%

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 (13.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.3) + 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.