2263.HK WACC - Weighted Average Cost of Capital
The WACC of Fu Shek Financial Holdings Ltd (2263.HK) is 6.9%.
| Range | Selected | |
| Cost of equity | 5.9% - 7.9% | 6.9% |
| Tax rate | 16.0% - 17.5% | 16.75% |
| Cost of debt | 7.0% - 20.1% | 13.55% |
| WACC | 5.9% - 7.9% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.51 | 0.57 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.9% | 7.9% |
| Tax rate | 16.0% | 17.5% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 7.0% | 20.1% |
| After-tax WACC | 5.9% | 7.9% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 2263.HK | Fu Shek Financial Holdings Ltd | 0.01 | 0.43 | 0.43 |
| 397.HK | Power Financial Group Ltd | 0.15 | 0.38 | 0.34 |
| 430.HK | Oriental Explorer Holdings Ltd | 0.96 | 0.13 | 0.07 |
| 510.HK | CASH Financial Services Group Ltd | 0.9 | 1.8 | 1.03 |
| 8098.HK | CL Group (Holdings) Ltd | 0.29 | 0.16 | 0.13 |
| 8168.HK | Amasse Capital Holdings Ltd | 0.02 | 0.15 | 0.15 |
| 8221.HK | PF Group Holdings Ltd | 0.62 | 0.51 | 0.34 |
| 8333.HK | Astrum Financial Holdings Ltd | 0.23 | 0.47 | 0.39 |
| 8350.HK | Excalibur Global Financial Holdings Ltd | 0.29 | 0.61 | 0.49 |
| 8540.HK | Victory Securities (Holdings) Company Ltd | 0.26 | 0.12 | 0.1 |
| Low | High | |
| Unlevered beta | 0.26 | 0.36 |
| Relevered beta | 0.27 | 0.36 |
| Adjusted relevered beta | 0.51 | 0.57 |
2263.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 2263.HK:
cost_of_equity (6.90%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.51) + 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.