784.HK WACC - Weighted Average Cost of Capital

The WACC of Ling Yui Holdings Ltd (784.HK) is 5.1%.

The Cost of Equity of Ling Yui Holdings Ltd (784.HK) is 5.95%.

The Cost of Debt of Ling Yui Holdings Ltd (784.HK) is 5.50%.

	Range	Selected
Cost of equity	4.90% - 7.00%	5.95%
Tax rate	19.60% - 39.10%	29.35%
Cost of debt	5.00% - 6.00%	5.50%
WACC	4.6% - 5.6%	5.1%

WACC

784.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.35	0.45

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.90%	7.00%

Tax rate	19.60%	39.10%
Debt/Equity ratio	0.71	0.71
Cost of debt	5.00%	6.00%

After-tax WACC	4.6%	5.6%


Selected WACC	5.1%

784.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 784.HK:

cost_of_equity (5.95%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.35) + 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.