1498.HK WACC - Weighted Average Cost of Capital
The WACC of PuraPharm Corp Ltd (1498.HK) is 6.4%.
| Range | Selected | |
| Cost of equity | 6.1% - 9.5% | 7.8% |
| Tax rate | 3.9% - 10.9% | 7.4% |
| Cost of debt | 5.2% - 7.0% | 6.1% |
| WACC | 5.4% - 7.4% | 6.4% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.54 | 0.8 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.1% | 9.5% |
| Tax rate | 3.9% | 10.9% |
| Debt/Equity ratio | 1.84 | 1.84 |
| Cost of debt | 5.2% | 7.0% |
| After-tax WACC | 5.4% | 7.4% |
| Selected WACC | 6.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1498.HK | PuraPharm Corp Ltd | 1.84 | 0.41 | 0.15 |
| 1889.HK | Sanai Health Industry Group Company Ltd | 0.9 | 0.12 | 0.06 |
| 2348.HK | Dawnrays Pharmaceutical (Holdings) Ltd | 0.02 | 0.33 | 0.33 |
| 239.HK | Pak Fah Yeow International Ltd | 0.01 | -0.2 | -0.19 |
| 2633.HK | Jacobson Pharma Corporation Ltd | 0.28 | 0.06 | 0.05 |
| 3613.HK | Beijing Tong Ren Tang Chinese Medicine Co Ltd | 0.02 | 0.76 | 0.75 |
| 455.HK | Tianda Pharmaceuticals Ltd | 0.42 | 0.39 | 0.28 |
| 858.HK | Extrawell Pharmaceutical Holdings Ltd | 0.95 | 0.45 | 0.24 |
| 897.HK | Wai Yuen Tong Medicine Holdings Ltd | 1.42 | -0.1 | -0.04 |
| 950.HK | Lee's Pharmaceutical Holdings Ltd | 0.26 | 0.71 | 0.57 |
| Low | High | |
| Unlevered beta | 0.12 | 0.25 |
| Relevered beta | 0.31 | 0.7 |
| Adjusted relevered beta | 0.54 | 0.8 |
1498.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 1498.HK:
cost_of_equity (7.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.54) + 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.