3709.HK WACC - Weighted Average Cost of Capital
The WACC of EEKA Fashion Holdings Ltd (3709.HK) is 7.8%.
| Range | Selected | |
| Cost of equity | 7.4% - 10.3% | 8.85% |
| Tax rate | 16.4% - 17.6% | 17% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 6.6% - 9.0% | 7.8% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.75 | 0.92 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.4% | 10.3% |
| Tax rate | 16.4% | 17.6% |
| Debt/Equity ratio | 0.25 | 0.25 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 6.6% | 9.0% |
| Selected WACC | 7.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 3709.HK | EEKA Fashion Holdings Ltd | 0.25 | 0.32 | 0.27 |
| 000753.SZ | Fujian Zhangzhou Development Co Ltd | 0.88 | 1.2 | 0.69 |
| 1817.HK | Mulsanne Group Holding Ltd | 3.22 | -0.12 | -0.03 |
| 600122.SS | Jiangsu Hongtu High Technology Co Ltd | 16.56 | 0.89 | 0.06 |
| 600386.SS | Beijing Bashi Media Co Ltd | 0.61 | 1.56 | 1.03 |
| 6110.HK | Topsports International Holdings Ltd | 0.14 | 1.74 | 1.55 |
| 8185.T | Chiyoda Co Ltd | 0.02 | 0.7 | 0.69 |
| ARVINDFASN.NS | Arvind Fashions Ltd | 0.18 | 1.17 | 1.02 |
| AX1.AX | Accent Group Ltd | 0.49 | 1.12 | 0.79 |
| MOZ.AX | Mosaic Brands Ltd | 17.95 | 1.62 | 0.1 |
| Low | High | |
| Unlevered beta | 0.52 | 0.73 |
| Relevered beta | 0.63 | 0.88 |
| Adjusted relevered beta | 0.75 | 0.92 |
3709.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 3709.HK:
cost_of_equity (8.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.75) + 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.