730.HK WACC - Weighted Average Cost of Capital
The WACC of Shougang Concord Grand (Group) Ltd (730.HK) is 7.8%.
| Range | Selected | |
| Cost of equity | 6.8% - 9.3% | 8.05% |
| Tax rate | 27.0% - 31.5% | 29.25% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 6.6% - 9.0% | 7.8% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.66 | 0.78 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.8% | 9.3% |
| Tax rate | 27.0% | 31.5% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 6.6% | 9.0% |
| Selected WACC | 7.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 730.HK | Shougang Concord Grand (Group) Ltd | 0.05 | 0.53 | 0.52 |
| 1319.HK | Oi Wah Pawnshop Credit Holdings Ltd | 0.25 | 0.12 | 0.1 |
| 1577.HK | Quanzhou Huixin Micro-credit Co Ltd | 0 | 0.81 | 0.81 |
| 534680.BO | SRG Housing Finance Ltd | 1.18 | 1.77 | 0.98 |
| 538772.BO | Niyogin Fintech Ltd | 0.12 | 0.76 | 0.7 |
| 622.HK | Oshidori International Holdings Ltd | 0.04 | 0.43 | 0.42 |
| 8019.HK | Hao Wen Holdings Ltd | 0.76 | 0.95 | 0.62 |
| 8239.HK | Capital Finance Holdings Ltd | 0.97 | -0.19 | -0.11 |
| 8325.HK | China Smartpay Group Holdings Ltd | 2.47 | -0.17 | -0.06 |
| ARMANFIN.NS | Arman Financial Services Ltd | 0.92 | 1.34 | 0.81 |
| Low | High | |
| Unlevered beta | 0.48 | 0.65 |
| Relevered beta | 0.49 | 0.67 |
| Adjusted relevered beta | 0.66 | 0.78 |
730.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 730.HK:
cost_of_equity (8.05%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.66) + 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.