8007.HK WACC - Weighted Average Cost of Capital

The WACC of Global Strategic Group Ltd (8007.HK) is 5.4%.

The Cost of Equity of Global Strategic Group Ltd (8007.HK) is 10.10%.

The Cost of Debt of Global Strategic Group Ltd (8007.HK) is 6.15%.

	Range	Selected
Cost of equity	7.80% - 12.40%	10.10%
Tax rate	16.00% - 21.70%	18.85%
Cost of debt	6.00% - 6.30%	6.15%
WACC	5.3% - 5.5%	5.4%

WACC

8007.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.83	1.22

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.80%	12.40%

Tax rate	16.00%	21.70%
Debt/Equity ratio	11.37	11.37
Cost of debt	6.00%	6.30%

After-tax WACC	5.3%	5.5%


Selected WACC	5.4%

8007.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 8007.HK:

cost_of_equity (10.10%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.83) + 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.