681.HK WACC - Weighted Average Cost of Capital
The WACC of Chinese People Holdings Company Ltd (681.HK) is 5.6%.
| Range | Selected | |
| Cost of equity | 5.2% - 7.5% | 6.35% |
| Tax rate | 13.5% - 14.9% | 14.2% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.7% - 6.5% | 5.6% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.39 | 0.52 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.2% | 7.5% |
| Tax rate | 13.5% | 14.9% |
| Debt/Equity ratio | 0.38 | 0.38 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.7% | 6.5% |
| Selected WACC | 5.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 681.HK | Chinese People Holdings Company Ltd | 0.38 | 0.66 | 0.49 |
| 000571.SZ | Sundiro Holding Co Ltd | 0.18 | 0.77 | 0.67 |
| 000669.SZ | Jinhong Holding Group Co Ltd | 0.71 | 0.49 | 0.31 |
| 1393.HK | Hidili Industry International Development Ltd | 30 | 1.04 | 0.04 |
| 1555.HK | MIE Holdings Corp | 21.96 | 1.57 | 0.08 |
| 1738.HK | Feishang Anthracite Resources Ltd | 14.45 | -0.12 | -0.01 |
| 5PD.SI | Hengyang Petrochemical Logistics Ltd | 0 | -0.84 | -0.84 |
| 600759.SS | Geo-Jade Petroleum Corp | 0.07 | 0.61 | 0.58 |
| 866.HK | China Qinfa Group Ltd | 0.3 | -0.23 | -0.18 |
| C9Q.SI | Sinostar Pec Holdings Ltd | 0.43 | 0.22 | 0.16 |
| Low | High | |
| Unlevered beta | 0.06 | 0.22 |
| Relevered beta | 0.09 | 0.28 |
| Adjusted relevered beta | 0.39 | 0.52 |
681.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 681.HK:
cost_of_equity (6.35%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.39) + 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.