6805.HK WACC - Weighted Average Cost of Capital
The WACC of Kimou Environmental Holding Ltd (6805.HK) is 5.7%.
| Range | Selected | |
| Cost of equity | 6.3% - 9.0% | 7.65% |
| Tax rate | 29.7% - 32.4% | 31.05% |
| Cost of debt | 6.5% - 6.9% | 6.7% |
| WACC | 5.2% - 6.3% | 5.7% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.57 | 0.73 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.3% | 9.0% |
| Tax rate | 29.7% | 32.4% |
| Debt/Equity ratio | 1.68 | 1.68 |
| Cost of debt | 6.5% | 6.9% |
| After-tax WACC | 5.2% | 6.3% |
| Selected WACC | 5.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 6805.HK | Kimou Environmental Holding Ltd | 1.68 | 0.32 | 0.15 |
| 1397.HK | Baguio Green Group Ltd | 0.45 | 0.22 | 0.17 |
| 154.HK | Beijing Enterprises Environment Group Ltd | 6.68 | 0.35 | 0.06 |
| 257.HK | China Everbright Environment Group Ltd | 3.84 | 0.35 | 0.1 |
| 309.HK | Xinhua News Media Holdings Ltd | 0.16 | 0.3 | 0.27 |
| 3267.T | Phil Company Inc | 0.33 | 1.02 | 0.83 |
| 436.HK | New Universe Environmental Group Ltd | 0.3 | 0.73 | 0.6 |
| 6812.HK | Winson Holdings Hong Kong Ltd | 0.03 | 0.69 | 0.67 |
| 8309.HK | Man Shing Global Holdings Ltd | 1 | 0.28 | 0.16 |
| 8472.HK | Lapco Holdings Ltd | 0.71 | 0.43 | 0.28 |
| Low | High | |
| Unlevered beta | 0.17 | 0.28 |
| Relevered beta | 0.36 | 0.6 |
| Adjusted relevered beta | 0.57 | 0.73 |
6805.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 6805.HK:
cost_of_equity (7.65%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.57) + 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.