1543.HK WACC - Weighted Average Cost of Capital

The WACC of Guangdong Join-Share Financing Guarantee Investment Co Ltd (1543.HK) is 4.8%.

The Cost of Equity of Guangdong Join-Share Financing Guarantee Investment Co Ltd (1543.HK) is 7.40%.

The Cost of Debt of Guangdong Join-Share Financing Guarantee Investment Co Ltd (1543.HK) is 6.05%.

	Range	Selected
Cost of equity	5.20% - 9.60%	7.40%
Tax rate	29.40% - 32.30%	30.85%
Cost of debt	4.00% - 8.10%	6.05%
WACC	3.3% - 6.3%	4.8%

WACC

1543.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	-0.03	0.46

Additional risk adjustments	2.5%	3.0%
Cost of equity	5.20%	9.60%

Tax rate	29.40%	32.30%
Debt/Equity ratio	3.87	3.87
Cost of debt	4.00%	8.10%

After-tax WACC	3.3%	6.3%


Selected WACC	4.8%

1543.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 1543.HK:

cost_of_equity (7.40%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (-0.03) + risk_adjustments (2.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.