9979.HK WACC - Weighted Average Cost of Capital

The WACC of Greentown Management Holdings Company Ltd (9979.HK) is 9.8%.

The Cost of Equity of Greentown Management Holdings Company Ltd (9979.HK) is 9.85%.

The Cost of Debt of Greentown Management Holdings Company Ltd (9979.HK) is 9.45%.

	Range	Selected
Cost of equity	8.50% - 11.20%	9.85%
Tax rate	20.80% - 21.50%	21.15%
Cost of debt	4.00% - 14.90%	9.45%
WACC	8.5% - 11.2%	9.8%

WACC

9979.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.94	1.05

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.50%	11.20%

Tax rate	20.80%	21.50%
Debt/Equity ratio	0	0
Cost of debt	4.00%	14.90%

After-tax WACC	8.5%	11.2%


Selected WACC	9.8%

9979.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 9979.HK:

cost_of_equity (9.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.94) + 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.