9633.HK WACC - Weighted Average Cost of Capital

The WACC of Nongfu Spring Co Ltd (9633.HK) is 12.3%.

The Cost of Equity of Nongfu Spring Co Ltd (9633.HK) is 12.40%.

The Cost of Debt of Nongfu Spring Co Ltd (9633.HK) is 4.25%.

	Range	Selected
Cost of equity	11.00% - 13.80%	12.40%
Tax rate	23.20% - 23.30%	23.25%
Cost of debt	4.00% - 4.50%	4.25%
WACC	10.9% - 13.7%	12.3%

WACC

9633.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.35	1.42

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.00%	13.80%

Tax rate	23.20%	23.30%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	4.50%

After-tax WACC	10.9%	13.7%


Selected WACC	12.3%

9633.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 9633.HK:

cost_of_equity (12.40%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.35) + 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.