1655.HK
Okura Holdings Ltd
Price:  
0.12 
HKD
Volume:  
35,000.00
Japan | Hotels, Restaurants & Leisure
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

1655.HK WACC - Weighted Average Cost of Capital

The WACC of Okura Holdings Ltd (1655.HK) is 5.9%.

The Cost of Equity of Okura Holdings Ltd (1655.HK) is 18.05%.
The Cost of Debt of Okura Holdings Ltd (1655.HK) is 4.25%.

Range Selected
Cost of equity 8.00% - 28.10% 18.05%
Tax rate 6.80% - 8.30% 7.55%
Cost of debt 4.00% - 4.50% 4.25%
WACC 4.3% - 7.5% 5.9%
WACC

1655.HK WACC calculation

Category Low High
Long-term bond rate 2.9% 3.4%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.85 3.47
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.00% 28.10%
Tax rate 6.80% 8.30%
Debt/Equity ratio 6.08 6.08
Cost of debt 4.00% 4.50%
After-tax WACC 4.3% 7.5%
Selected WACC 5.9%

1655.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 1655.HK:

cost_of_equity (18.05%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.85) + 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.