709.HK WACC - Weighted Average Cost of Capital

The WACC of Giordano International Ltd (709.HK) is 7.8%.

The Cost of Equity of Giordano International Ltd (709.HK) is 9.20%.

The Cost of Debt of Giordano International Ltd (709.HK) is 4.25%.

	Range	Selected
Cost of equity	7.00% - 11.40%	9.20%
Tax rate	21.60% - 23.90%	22.75%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.1% - 9.5%	7.8%

WACC

709.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.69	1.08

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.00%	11.40%

Tax rate	21.60%	23.90%
Debt/Equity ratio	0.32	0.32
Cost of debt	4.00%	4.50%

After-tax WACC	6.1%	9.5%


Selected WACC	7.8%

709.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 709.HK:

cost_of_equity (9.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.69) + 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.