46.HK WACC - Weighted Average Cost of Capital

The WACC of Computer and Technologies Holdings Ltd (46.HK) is 6.8%.

The Cost of Equity of Computer and Technologies Holdings Ltd (46.HK) is 7.00%.

The Cost of Debt of Computer and Technologies Holdings Ltd (46.HK) is 4.65%.

	Range	Selected
Cost of equity	5.50% - 8.50%	7.00%
Tax rate	8.40% - 10.00%	9.20%
Cost of debt	4.00% - 5.30%	4.65%
WACC	5.4% - 8.2%	6.8%

WACC

46.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.45	0.66

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.50%	8.50%

Tax rate	8.40%	10.00%
Debt/Equity ratio	0.06	0.06
Cost of debt	4.00%	5.30%

After-tax WACC	5.4%	8.2%


Selected WACC	6.8%

46.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 46.HK:

cost_of_equity (7.00%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.45) + 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.