9911.HK WACC - Weighted Average Cost of Capital

The WACC of Newborn Town Inc (9911.HK) is 10.7%.

The Cost of Equity of Newborn Town Inc (9911.HK) is 10.75%.

The Cost of Debt of Newborn Town Inc (9911.HK) is 6.00%.

	Range	Selected
Cost of equity	9.20% - 12.30%	10.75%
Tax rate	1.10% - 1.60%	1.35%
Cost of debt	4.00% - 8.00%	6.00%
WACC	9.1% - 12.2%	10.7%

WACC

9911.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.06	1.2

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.20%	12.30%

Tax rate	1.10%	1.60%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	8.00%

After-tax WACC	9.1%	12.2%


Selected WACC	10.7%

9911.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 9911.HK:

cost_of_equity (10.75%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.06) + 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.