6839.HK
Yunnan Water Investment Company Ltd
Price:  
0.19 
HKD
Volume:  
846,000.00
China | Water Utilities
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

6839.HK WACC - Weighted Average Cost of Capital

The WACC of Yunnan Water Investment Company Ltd (6839.HK) is 4.9%.

The Cost of Equity of Yunnan Water Investment Company Ltd (6839.HK) is 33.70%.
The Cost of Debt of Yunnan Water Investment Company Ltd (6839.HK) is 5.65%.

Range Selected
Cost of equity 25.40% - 42.00% 33.70%
Tax rate 11.70% - 19.60% 15.65%
Cost of debt 4.30% - 7.00% 5.65%
WACC 4.0% - 5.9% 4.9%
WACC

6839.HK WACC calculation

Category Low High
Long-term bond rate 2.9% 3.4%
Equity market risk premium 6.0% 7.0%
Adjusted beta 3.77 5.46
Additional risk adjustments 0.0% 0.5%
Cost of equity 25.40% 42.00%
Tax rate 11.70% 19.60%
Debt/Equity ratio 140.71 140.71
Cost of debt 4.30% 7.00%
After-tax WACC 4.0% 5.9%
Selected WACC 4.9%

6839.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 6839.HK:

cost_of_equity (33.70%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (3.77) + 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.