834.HK
China Kangda Food Co Ltd
Price:  
0.17 
HKD
Volume:  
40,000.00
China | Food Products
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834.HK WACC - Weighted Average Cost of Capital

The WACC of China Kangda Food Co Ltd (834.HK) is 12.8%.

The Cost of Equity of China Kangda Food Co Ltd (834.HK) is 10.15%.
The Cost of Debt of China Kangda Food Co Ltd (834.HK) is 13.45%.

Range Selected
Cost of equity 5.80% - 14.50% 10.15%
Tax rate 0.90% - 1.70% 1.30%
Cost of debt 4.00% - 22.90% 13.45%
WACC 4.2% - 21.3% 12.8%
WACC

834.HK WACC calculation

Category Low High
Long-term bond rate 2.9% 3.4%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.49 1.53
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.80% 14.50%
Tax rate 0.90% 1.70%
Debt/Equity ratio 5.53 5.53
Cost of debt 4.00% 22.90%
After-tax WACC 4.2% 21.3%
Selected WACC 12.8%

834.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 834.HK:

cost_of_equity (10.15%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.49) + 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.