772.HK WACC - Weighted Average Cost of Capital
The WACC of China Literature Ltd (772.HK) is 7.4%.
| Range | Selected | |
| Cost of equity | 6.4% - 8.4% | 7.4% |
| Tax rate | 16.3% - 20.6% | 18.45% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 6.4% - 8.4% | 7.4% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.59 | 0.65 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.4% | 8.4% |
| Tax rate | 16.3% | 20.6% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 6.4% | 8.4% |
| Selected WACC | 7.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 772.HK | China Literature Ltd | 0.01 | 1.27 | 1.26 |
| 600373.SS | Chinese Universe Publishing and Media Group Co Ltd | 0.27 | 0.69 | 0.57 |
| 600757.SS | Changjiang Publishing & Media Co Ltd | 0.02 | 0.41 | 0.41 |
| 601019.SS | Shandong Publishing & Media Co Ltd | 0.01 | 0.38 | 0.38 |
| 601098.SS | China South Publishing & Media Group Co Ltd | 0.09 | 0.24 | 0.23 |
| 601928.SS | Jiangsu Phoenix Publishing & Media Corp Ltd | 0.01 | 0.3 | 0.29 |
| 601949.SS | China Publishing & Media Holdings Co Ltd | 0.08 | 1.01 | 0.95 |
| 603000.SS | People.cn Co Ltd | 0.01 | 1.48 | 1.46 |
| 8087.HK | China 33 Media Group Ltd | 0.25 | 0.46 | 0.38 |
| 9468.T | Kadokawa Corp | 0.05 | 0.19 | 0.19 |
| Low | High | |
| Unlevered beta | 0.38 | 0.47 |
| Relevered beta | 0.39 | 0.48 |
| Adjusted relevered beta | 0.59 | 0.65 |
772.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 772.HK:
cost_of_equity (7.40%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.59) + 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.