8510.HK WACC - Weighted Average Cost of Capital

The WACC of Top Standard Corp (8510.HK) is 5.8%.

The Cost of Equity of Top Standard Corp (8510.HK) is 6.10%.

The Cost of Debt of Top Standard Corp (8510.HK) is 6.60%.

	Range	Selected
Cost of equity	4.80% - 7.40%	6.10%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	6.20% - 7.00%	6.60%
WACC	4.8% - 6.8%	5.8%

WACC

8510.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.16	0.37

Additional risk adjustments	1.0%	1.5%
Cost of equity	4.80%	7.40%

Tax rate	22.10%	22.30%
Debt/Equity ratio	0.48	0.48
Cost of debt	6.20%	7.00%

After-tax WACC	4.8%	6.8%


Selected WACC	5.8%

8510.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 8510.HK:

cost_of_equity (6.10%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.16) + risk_adjustments (1.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.