672.HK WACC - Weighted Average Cost of Capital

The WACC of Zhong An Group Ltd (672.HK) is 6.3%.

The Cost of Equity of Zhong An Group Ltd (672.HK) is 34.80%.

The Cost of Debt of Zhong An Group Ltd (672.HK) is 5.05%.

	Range	Selected
Cost of equity	29.50% - 40.10%	34.80%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	5.00% - 5.10%	5.05%
WACC	5.9% - 6.8%	6.3%

WACC

672.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	4.45	5.2

Additional risk adjustments	0.0%	0.5%
Cost of equity	29.50%	40.10%

Tax rate	22.10%	22.30%
Debt/Equity ratio	11.84	11.84
Cost of debt	5.00%	5.10%

After-tax WACC	5.9%	6.8%


Selected WACC	6.3%

672.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 672.HK:

cost_of_equity (34.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (4.45) + 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.