1239.HK WACC - Weighted Average Cost of Capital

The WACC of Teamway International Group Holdings Ltd (1239.HK) is 5.4%.

The Cost of Equity of Teamway International Group Holdings Ltd (1239.HK) is 5.75%.

The Cost of Debt of Teamway International Group Holdings Ltd (1239.HK) is 5.50%.

	Range	Selected
Cost of equity	4.20% - 7.30%	5.75%
Tax rate	1.80% - 3.20%	2.50%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.0% - 6.8%	5.4%

WACC

1239.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	0.28

Additional risk adjustments	1.5%	2.0%
Cost of equity	4.20%	7.30%

Tax rate	1.80%	3.20%
Debt/Equity ratio	7.54	7.54
Cost of debt	4.00%	7.00%

After-tax WACC	4.0%	6.8%


Selected WACC	5.4%

1239.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 1239.HK:

cost_of_equity (5.75%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (-0.03) + risk_adjustments (1.75%)

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