848.HK WACC - Weighted Average Cost of Capital

The WACC of Maoye International Holdings Ltd (848.HK) is 9.3%.

The Cost of Equity of Maoye International Holdings Ltd (848.HK) is 54.15%.

The Cost of Debt of Maoye International Holdings Ltd (848.HK) is 9.30%.

	Range	Selected
Cost of equity	32.40% - 75.90%	54.15%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	4.00% - 14.60%	9.30%
WACC	4.4% - 14.2%	9.3%

WACC

848.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	4.94	10.32

Additional risk adjustments	0.0%	0.5%
Cost of equity	32.40%	75.90%

Tax rate	22.10%	22.30%
Debt/Equity ratio	21.85	21.85
Cost of debt	4.00%	14.60%

After-tax WACC	4.4%	14.2%


Selected WACC	9.3%

848.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 848.HK:

cost_of_equity (54.15%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (4.94) + 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.