1818.HK
ZHAOJIN MININGClosed1818.HK discounted cash flow valuation
1818.HK Fair Value
Reverse DCF: today's price implies 35.7% a year of FCF growth for years 1–5, against 25.0% in this model.
Model: 25.0% from analyst next-year EPS & revenue growth (capped). Fades linearly to terminal growth by year 10.
Model: 8.45% (CAPM, see the build-up).
Long-run growth after year 10; keep it at or below nominal GDP.
Value Bridge
| PV of free cash flow, years 1–10 | HKD 12.20B |
|---|---|
| PV of terminal value (67% of EV) | HKD 24.67B |
| Enterprise value | HKD 36.87B |
| + Cash & investments | HKD 8.85B |
| − Total debt | −HKD 21.78B |
| Equity value | HKD 23.95B |
| ÷ Shares outstanding | 2.88B |
| Value per share | HKD 8.31 |
| Market cap | HKD 62.42B |
CNY statements converted at 1.172 HKD.
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.22% |
|---|---|
| Beta (clamped 0.5–2.5) | 0.94 |
| Equity risk premium | 5.00% |
| Cost of equity (CAPM) | 9.89% |
| Pre-tax cost of debt | 5.22% |
| Tax rate | 16.9% |
| Debt / (equity + debt) | 25.9% |
| WACC | 8.45% |
Cost of debt is interest expense ÷ total debt, held between the risk-free rate and 12%.
Free Cash Flow: History and Projection
Sensitivity: Value per Share
| WACC ↓ / g → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 6.45% | 12.17 | 13.78 | 15.80 | 18.41 | 21.90 |
| 7.45% | 9.01 | 10.05 | 11.29 | 12.81 | 14.72 |
| 8.45% | 6.78 | 7.48 | 8.31 | 9.29 | 10.46 |
| 9.45% | 5.12 | 5.63 | 6.21 | 6.87 | 7.66 |
| 10.45% | 3.84 | 4.22 | 4.64 | 5.12 | 5.67 |
Green is above today's price, red below (full colour at ±30%). The outlined centre cell is the current inputs.
Projected Cash Flows
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Base (FY2024) | — | HKD 617.89M | — | — |
| Year 1 | 25.0% | HKD 772.37M | 0.922 | HKD 712.19M |
| Year 2 | 25.0% | HKD 965.46M | 0.850 | HKD 820.87M |
| Year 3 | 25.0% | HKD 1.21B | 0.784 | HKD 946.14M |
| Year 4 | 25.0% | HKD 1.51B | 0.723 | HKD 1.09B |
| Year 5 | 25.0% | HKD 1.89B | 0.667 | HKD 1.26B |
| Year 6 | 20.5% | HKD 2.27B | 0.615 | HKD 1.40B |
| Year 7 | 16.0% | HKD 2.64B | 0.567 | HKD 1.49B |
| Year 8 | 11.5% | HKD 2.94B | 0.523 | HKD 1.54B |
| Year 9 | 7.0% | HKD 3.14B | 0.482 | HKD 1.52B |
| Year 10 | 2.5% | HKD 3.22B | 0.444 | HKD 1.43B |
Method
Two-stage free-cash-flow model, the same as the bot's lgf dcf: five years at the chosen growth rate, a straight-line fade to terminal growth by year ten, then a Gordon-growth terminal value. Everything is discounted at WACC.
Base cash flow is the trailing four quarters of operating cash flow minus capital expenditure (the latest fiscal year when quarters are missing). Default growth uses analyst long-term growth when Yahoo publishes it, else the average of next year's EPS and revenue growth, else revenue CAGR, held between −5% and 25%.
A DCF is only as good as its inputs. The terminal value is usually most of the answer, so read the sensitivity grid before the headline number. This is a model, not investment advice.