The WACC of Beijing Gas Blue Sky Holdings Ltd (6828.HK) is 10.1%.
Range | Selected | |
Cost of equity | 5.7% - 8.7% | 7.2% |
Tax rate | 5.8% - 15.3% | 10.55% |
Cost of debt | 4.0% - 22.9% | 13.45% |
WACC | 4.4% - 15.8% | 10.1% |
Category | Low | High |
Long-term bond rate | 2.9% | 3.4% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 0.48 | 0.7 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 5.7% | 8.7% |
Tax rate | 5.8% | 15.3% |
Debt/Equity ratio | 1.99 | 1.99 |
Cost of debt | 4.0% | 22.9% |
After-tax WACC | 4.4% | 15.8% |
Selected WACC | 10.1% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
6828.HK | Beijing Gas Blue Sky Holdings Ltd | 1.99 | 1.83 | 0.64 |
034590.KS | Incheon City Gas Co Ltd | 0.16 | 0.07 | 0.06 |
1083.HK | Towngas China Company Ltd | 1.24 | 0.4 | 0.19 |
1193.HK | China Resources Gas Group Ltd | 0.5 | 0.64 | 0.43 |
384.HK | China Gas Holdings Ltd | 1.42 | 0.81 | 0.35 |
392.HK | Beijing Enterprises Holdings Ltd | 1.94 | 0.56 | 0.2 |
603.HK | China Oil and Gas Group Ltd | 9.57 | 0.4 | 0.04 |
9537.T | Hokuriku Gas Co Ltd | 0.01 | 0.08 | 0.08 |
9908.TW | Great Taipei Gas Corp | 0 | -0.01 | -0.01 |
RTGZ.ME | Gazprom Gazoraspredeleniye Rostov-Na-Donu PAO | 0.6 | 0.1 | 0.07 |
Low | High | |
Unlevered beta | 0.08 | 0.19 |
Relevered beta | 0.22 | 0.55 |
Adjusted relevered beta | 0.48 | 0.7 |
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 6828.HK:
cost_of_equity (7.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.48) + 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.