635.HK
Playmates Holdings Ltd
Price:  
0.53 
HKD
Volume:  
16,000
Hong Kong | Leisure Products

635.HK WACC - Weighted Average Cost of Capital

The WACC of Playmates Holdings Ltd (635.HK) is 7.8%.

The Cost of Equity of Playmates Holdings Ltd (635.HK) is 8.5%.
The Cost of Debt of Playmates Holdings Ltd (635.HK) is 4.25%.

RangeSelected
Cost of equity6.1% - 10.9%8.5%
Tax rate20.7% - 25.3%23%
Cost of debt4.0% - 4.5%4.25%
WACC5.7% - 9.8%7.8%
WACC

635.HK WACC calculation

CategoryLowHigh
Long-term bond rate2.9%3.4%
Equity market risk premium6.0%7.0%
Adjusted beta0.541.01
Additional risk adjustments0.0%0.5%
Cost of equity6.1%10.9%
Tax rate20.7%25.3%
Debt/Equity ratio
0.170.17
Cost of debt4.0%4.5%
After-tax WACC5.7%9.8%
Selected WACC7.8%

635.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 635.HK:

cost_of_equity (8.50%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.54) + 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.