6169.HK WACC - Weighted Average Cost of Capital

The WACC of China Yuhua Education Corp Ltd (6169.HK) is 8.6%.

The Cost of Equity of China Yuhua Education Corp Ltd (6169.HK) is 10.50%.

The Cost of Debt of China Yuhua Education Corp Ltd (6169.HK) is 4.25%.

	Range	Selected
Cost of equity	8.70% - 12.30%	10.50%
Tax rate	0.70% - 0.90%	0.80%
Cost of debt	4.00% - 4.50%	4.25%
WACC	7.3% - 9.9%	8.6%

WACC

6169.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.97	1.2

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.70%	12.30%

Tax rate	0.70%	0.90%
Debt/Equity ratio	0.43	0.43
Cost of debt	4.00%	4.50%

After-tax WACC	7.3%	9.9%


Selected WACC	8.6%

6169.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 6169.HK:

cost_of_equity (10.50%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.97) + 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.