8507.HK WACC - Weighted Average Cost of Capital

The WACC of i.century Holding Ltd (8507.HK) is 6.4%.

The Cost of Equity of i.century Holding Ltd (8507.HK) is 6.30%.

The Cost of Debt of i.century Holding Ltd (8507.HK) is 6.55%.

	Range	Selected
Cost of equity	5.00% - 7.60%	6.30%
Tax rate	0.40% - 0.80%	0.60%
Cost of debt	6.10% - 7.00%	6.55%
WACC	5.5% - 7.3%	6.4%

WACC

8507.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.36	0.53

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.00%	7.60%

Tax rate	0.40%	0.80%
Debt/Equity ratio	0.75	0.75
Cost of debt	6.10%	7.00%

After-tax WACC	5.5%	7.3%


Selected WACC	6.4%

8507.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 8507.HK:

cost_of_equity (6.30%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.36) + 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.