1665.HK WACC - Weighted Average Cost of Capital

The WACC of Pentamaster International Ltd (1665.HK) is 11.8%.

The Cost of Equity of Pentamaster International Ltd (1665.HK) is 18.70%.

The Cost of Debt of Pentamaster International Ltd (1665.HK) is 5.00%.

	Range	Selected
Cost of equity	16.90% - 20.50%	18.70%
Tax rate	1.00% - 1.20%	1.10%
Cost of debt	5.00% - 5.00%	5.00%
WACC	10.9% - 12.7%	11.8%

WACC

1665.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	2.34	2.38

Additional risk adjustments	0.0%	0.5%
Cost of equity	16.90%	20.50%

Tax rate	1.00%	1.20%
Debt/Equity ratio	1	1
Cost of debt	5.00%	5.00%

After-tax WACC	10.9%	12.7%


Selected WACC	11.8%

1665.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 1665.HK:

cost_of_equity (18.70%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (2.34) + 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.