990.HK WACC - Weighted Average Cost of Capital

The WACC of Theme International Holdings Ltd (990.HK) is 7.4%.

The Cost of Equity of Theme International Holdings Ltd (990.HK) is 7.05%.

The Cost of Debt of Theme International Holdings Ltd (990.HK) is 27.45%.

	Range	Selected
Cost of equity	5.50% - 8.60%	7.05%
Tax rate	8.40% - 9.40%	8.90%
Cost of debt	4.00% - 50.90%	27.45%
WACC	5.4% - 9.3%	7.4%

WACC

990.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.44	0.68

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.50%	8.60%

Tax rate	8.40%	9.40%
Debt/Equity ratio	0.02	0.02
Cost of debt	4.00%	50.90%

After-tax WACC	5.4%	9.3%


Selected WACC	7.4%

990.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 990.HK:

cost_of_equity (7.05%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.44) + 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.