The WACC of Zengame Technology Holding Ltd (2660.HK) is 11.5%.
Range | Selected | |
Cost of equity | 9.8% - 13.3% | 11.55% |
Tax rate | 14.1% - 17.0% | 15.55% |
Cost of debt | 4.0% - 8.9% | 6.45% |
WACC | 9.7% - 13.3% | 11.5% |
Category | Low | High |
Long-term bond rate | 2.9% | 3.4% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 1.15 | 1.36 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.8% | 13.3% |
Tax rate | 14.1% | 17.0% |
Debt/Equity ratio | 0.01 | 0.01 |
Cost of debt | 4.0% | 8.9% |
After-tax WACC | 9.7% | 13.3% |
Selected WACC | 11.5% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
2660.HK | Zengame Technology Holding Ltd | 0.01 | 0.46 | 0.46 |
002354.SZ | Dalian Zeus Entertainment Co Ltd | 0 | 1.5 | 1.49 |
2022.HK | Digital Hollywood Interactive Ltd | 0.1 | 0.94 | 0.87 |
300052.SZ | Shenzhen Zqgame Co Ltd | 0.11 | 2.07 | 1.9 |
300235.SZ | Shenzhen Kingsun Science & Technology Co Ltd | 0 | 1.45 | 1.45 |
300299.SZ | Fuchun Technology Co Ltd | 0.05 | 1.79 | 1.72 |
300467.SZ | Sichuan Xunyou Network Technology Co Ltd | 0 | 1.73 | 1.73 |
300533.SZ | Shenzhen Bingchuan Network Co Ltd | 0.01 | 1.57 | 1.56 |
434.HK | Boyaa Interactive International Ltd | 0 | -0.17 | -0.17 |
6860.HK | FingerTango Inc | 0.05 | 0.18 | 0.17 |
Low | High | |
Unlevered beta | 1.22 | 1.52 |
Relevered beta | 1.22 | 1.54 |
Adjusted relevered beta | 1.15 | 1.36 |
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 2660.HK:
cost_of_equity (11.55%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.15) + 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.