382.HK WACC - Weighted Average Cost of Capital

The WACC of Edvantage Group Holdings Ltd (382.HK) is 8.3%.

The Cost of Equity of Edvantage Group Holdings Ltd (382.HK) is 16.05%.

The Cost of Debt of Edvantage Group Holdings Ltd (382.HK) is 5.25%.

	Range	Selected
Cost of equity	10.90% - 21.20%	16.05%
Tax rate	1.00% - 1.20%	1.10%
Cost of debt	4.00% - 6.50%	5.25%
WACC	5.9% - 10.6%	8.3%

WACC

382.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.35	2.48

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.90%	21.20%

Tax rate	1.00%	1.20%
Debt/Equity ratio	2.54	2.54
Cost of debt	4.00%	6.50%

After-tax WACC	5.9%	10.6%


Selected WACC	8.3%

382.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 382.HK:

cost_of_equity (16.05%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.35) + 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.