The WACC of Anxian Yuan China Holdings Ltd (922.HK) is 7.2%.
Range | Selected | |
Cost of equity | 6.2% - 8.5% | 7.35% |
Tax rate | 30.2% - 32.0% | 31.1% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 6.1% - 8.2% | 7.2% |
Category | Low | High |
Long-term bond rate | 2.9% | 3.4% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 0.56 | 0.66 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.2% | 8.5% |
Tax rate | 30.2% | 32.0% |
Debt/Equity ratio | 0.05 | 0.05 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 6.1% | 8.2% |
Selected WACC | 7.2% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
922.HK | Anxian Yuan China Holdings Ltd | 0.05 | 0.16 | 0.16 |
1827.HK | Miricor Enterprises Holdings Ltd | 0.19 | -0.08 | -0.07 |
1830.HK | Perfect Shape Medical Ltd | 0.12 | 0.7 | 0.64 |
2700.HK | Green International Holdings Ltd | 0.1 | -0.02 | -0.01 |
3041.T | Beauty Kadan Co Ltd | 0.66 | 1.06 | 0.73 |
8296.HK | Sino-Life Group Ltd | 0.81 | 0.57 | 0.36 |
8455.HK | Lai Group Holding Company Ltd | 0.12 | 1.39 | 1.29 |
8483.HK | Max Sight Group Holdings Ltd | 0.11 | 0.34 | 0.32 |
8603.HK | Fameglow Holdings Ltd | 0.09 | 0.37 | 0.35 |
KAYA.NS | Kaya Ltd | 0.44 | 1.25 | 0.96 |
Low | High | |
Unlevered beta | 0.34 | 0.48 |
Relevered beta | 0.34 | 0.49 |
Adjusted relevered beta | 0.56 | 0.66 |
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 922.HK:
cost_of_equity (7.35%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.56) + 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.