1110.HK WACC - Weighted Average Cost of Capital

The WACC of Kingworld Medicines Group Ltd (1110.HK) is 6.2%.

The Cost of Equity of Kingworld Medicines Group Ltd (1110.HK) is 12.50%.

The Cost of Debt of Kingworld Medicines Group Ltd (1110.HK) is 4.30%.

	Range	Selected
Cost of equity	9.70% - 15.30%	12.50%
Tax rate	29.90% - 33.10%	31.50%
Cost of debt	4.10% - 4.50%	4.30%
WACC	5.2% - 7.2%	6.2%

WACC

1110.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.15	1.64

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.70%	15.30%

Tax rate	29.90%	33.10%
Debt/Equity ratio	1.94	1.94
Cost of debt	4.10%	4.50%

After-tax WACC	5.2%	7.2%


Selected WACC	6.2%

1110.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 1110.HK:

cost_of_equity (12.50%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.15) + 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.