8126.HK WACC - Weighted Average Cost of Capital

The WACC of G.A. Holdings LTD (8126.HK) is 7.6%.

The Cost of Equity of G.A. Holdings LTD (8126.HK) is 16.90%.

The Cost of Debt of G.A. Holdings LTD (8126.HK) is 11.95%.

	Range	Selected
Cost of equity	12.40% - 21.40%	16.90%
Tax rate	32.90% - 39.00%	35.95%
Cost of debt	4.00% - 19.90%	11.95%
WACC	2.9% - 12.3%	7.6%

WACC

8126.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.59	2.51

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.40%	21.40%

Tax rate	32.90%	39.00%
Debt/Equity ratio	45.88	45.88
Cost of debt	4.00%	19.90%

After-tax WACC	2.9%	12.3%


Selected WACC	7.6%

8126.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 8126.HK:

cost_of_equity (16.90%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.59) + 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.