831.HK WACC - Weighted Average Cost of Capital
The WACC of Convenience Retail Asia Ltd (831.HK) is 6.1%.
| Range | Selected | |
| Cost of equity | 5.9% - 9.7% | 7.8% |
| Tax rate | 14.9% - 16.8% | 15.85% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.1% - 7.0% | 6.1% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.52 | 0.83 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.9% | 9.7% |
| Tax rate | 14.9% | 16.8% |
| Debt/Equity ratio | 0.91 | 0.91 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.1% | 7.0% |
| Selected WACC | 6.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 831.HK | Convenience Retail Asia Ltd | 0.91 | 0.18 | 0.1 |
| 1389.HK | Major Holdings Ltd | 0.01 | 0.16 | 0.16 |
| 2360.HK | Best Mart 360 Holdings Ltd | 0.17 | 0.18 | 0.16 |
| 4006.SR | Saudi Marketing Company SJSC | 1.58 | 1.55 | 0.66 |
| 601116.SS | Sanjiang Shopping Club Co Ltd | 0.05 | 1.2 | 1.16 |
| 605188.SS | Jiangxi Guoguang Commercial Chains Co Ltd | 0.12 | 1.41 | 1.28 |
| 759.HK | Cec International Holdings Ltd | 3.06 | 0.39 | 0.11 |
| 8241.HK | Ying Kee Tea House Group Ltd | 2.5 | 0.41 | 0.13 |
| D01.SI | Dairy Farm International Holdings Ltd | 0.9 | 0.47 | 0.26 |
| MIDI.JK | Midi Utama Indonesia Tbk PT | 0.05 | 0.7 | 0.67 |
| Low | High | |
| Unlevered beta | 0.16 | 0.42 |
| Relevered beta | 0.28 | 0.75 |
| Adjusted relevered beta | 0.52 | 0.83 |
831.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 831.HK:
cost_of_equity (7.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.52) + 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.