865.HK WACC - Weighted Average Cost of Capital

The WACC of Jiande International Holdings Ltd (865.HK) is 7.2%.

The Cost of Equity of Jiande International Holdings Ltd (865.HK) is 7.20%.

The Cost of Debt of Jiande International Holdings Ltd (865.HK) is 69.35%.

	Range	Selected
Cost of equity	5.80% - 8.60%	7.20%
Tax rate	22.10% - 22.30%	22.20%
Cost of debt	7.00% - 131.70%	69.35%
WACC	5.8% - 8.7%	7.2%

WACC

865.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.48	0.67

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.80%	8.60%

Tax rate	22.10%	22.30%
Debt/Equity ratio	0	0
Cost of debt	7.00%	131.70%

After-tax WACC	5.8%	8.7%


Selected WACC	7.2%

865.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 865.HK:

cost_of_equity (7.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.48) + 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.