846.HK
Mingfa Group (International) Co Ltd
Price:  
0.11 
HKD
Volume:  
30,000
Hong Kong | Real Estate Management & Development

846.HK WACC - Weighted Average Cost of Capital

The WACC of Mingfa Group (International) Co Ltd (846.HK) is 4.0%.

The Cost of Equity of Mingfa Group (International) Co Ltd (846.HK) is 6.25%.
The Cost of Debt of Mingfa Group (International) Co Ltd (846.HK) is 4.25%.

RangeSelected
Cost of equity5.1% - 7.4%6.25%
Tax rate22.1% - 22.3%22.2%
Cost of debt4.0% - 4.5%4.25%
WACC3.6% - 4.4%4.0%
WACC

846.HK WACC calculation

CategoryLowHigh
Long-term bond rate2.9%3.4%
Equity market risk premium6.0%7.0%
Adjusted beta0.370.5
Additional risk adjustments0.0%0.5%
Cost of equity5.1%7.4%
Tax rate22.1%22.3%
Debt/Equity ratio
3.493.49
Cost of debt4.0%4.5%
After-tax WACC3.6%4.4%
Selected WACC4.0%

846.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 846.HK:

cost_of_equity (6.25%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.37) + 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.