6098.HK WACC - Weighted Average Cost of Capital

The WACC of Country Garden Services Holdings Co Ltd (6098.HK) is 7.9%.

The Cost of Equity of Country Garden Services Holdings Co Ltd (6098.HK) is 8.70%.

The Cost of Debt of Country Garden Services Holdings Co Ltd (6098.HK) is 4.25%.

	Range	Selected
Cost of equity	7.40% - 10.00%	8.70%
Tax rate	33.40% - 39.70%	36.55%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.8% - 9.0%	7.9%

WACC

6098.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.76	0.88

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.40%	10.00%

Tax rate	33.40%	39.70%
Debt/Equity ratio	0.16	0.16
Cost of debt	4.00%	4.50%

After-tax WACC	6.8%	9.0%


Selected WACC	7.9%

6098.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 6098.HK:

cost_of_equity (8.70%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.76) + 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.