630.HK WACC - Weighted Average Cost of Capital

The WACC of AMCO United Holding Ltd (630.HK) is 7.7%.

The Cost of Equity of AMCO United Holding Ltd (630.HK) is 8.80%.

The Cost of Debt of AMCO United Holding Ltd (630.HK) is 6.90%.

	Range	Selected
Cost of equity	6.10% - 11.50%	8.80%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	6.90% - 6.90%	6.90%
WACC	5.9% - 9.5%	7.7%

WACC

630.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.55	1.09

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.10%	11.50%

Tax rate	22.10%	22.30%
Debt/Equity ratio	0.5	0.5
Cost of debt	6.90%	6.90%

After-tax WACC	5.9%	9.5%


Selected WACC	7.7%

630.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 630.HK:

cost_of_equity (8.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.55) + 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.