609.HK
Tiande Chemical Holdings Ltd
Price:  
1.2 
HKD
Volume:  
1,292,000
Hong Kong | Chemicals

609.HK WACC - Weighted Average Cost of Capital

The WACC of Tiande Chemical Holdings Ltd (609.HK) is 6.6%.

The Cost of Equity of Tiande Chemical Holdings Ltd (609.HK) is 7.45%.
The Cost of Debt of Tiande Chemical Holdings Ltd (609.HK) is 4.25%.

RangeSelected
Cost of equity5.8% - 9.1%7.45%
Tax rate26.3% - 28.0%27.15%
Cost of debt4.0% - 4.5%4.25%
WACC5.3% - 8.0%6.6%
WACC

609.HK WACC calculation

CategoryLowHigh
Long-term bond rate2.9%3.4%
Equity market risk premium6.0%7.0%
Adjusted beta0.490.75
Additional risk adjustments0.0%0.5%
Cost of equity5.8%9.1%
Tax rate26.3%28.0%
Debt/Equity ratio
0.230.23
Cost of debt4.0%4.5%
After-tax WACC5.3%8.0%
Selected WACC6.6%

609.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 609.HK:

cost_of_equity (7.45%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.49) + 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.