684.HK WACC - Weighted Average Cost of Capital
The WACC of Allan International Holdings Ltd (684.HK) is 7.2%.
| Range | Selected | |
| Cost of equity | 5.7% - 8.9% | 7.3% |
| Tax rate | 3.4% - 8.5% | 5.95% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 5.7% - 8.8% | 7.2% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.47 | 0.72 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.7% | 8.9% |
| Tax rate | 3.4% | 8.5% |
| Debt/Equity ratio | 0.03 | 0.03 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 5.7% | 8.8% |
| Selected WACC | 7.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 684.HK | Allan International Holdings Ltd | 0.03 | 0.11 | 0.1 |
| 1541.TW | Chang Type Industrial Co Ltd | 0.2 | 0.66 | 0.56 |
| 1691.HK | JS Global Lifestyle Co Ltd | 0.01 | 0.58 | 0.57 |
| 1692.HK | Town Ray Holdings Ltd | 0.1 | 0.26 | 0.24 |
| 2381.HK | SMC Electric Ltd | 0.04 | 0.14 | 0.13 |
| 464.HK | China Overseas Nuoxin International Holdings Ltd | 0.13 | 1.78 | 1.58 |
| 505729.BO | Singer India Ltd | 0 | 1.67 | 1.67 |
| 638.HK | Kin Yat Holdings Ltd | 1.21 | -0.26 | -0.12 |
| 833.HK | Alltronics Holdings Ltd | 0.91 | 0.32 | 0.17 |
| BUTTERFLY.NS | Butterfly Gandhimathi Appliances Ltd | 0.01 | 0.99 | 0.98 |
| Low | High | |
| Unlevered beta | 0.21 | 0.56 |
| Relevered beta | 0.21 | 0.58 |
| Adjusted relevered beta | 0.47 | 0.72 |
684.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 684.HK:
cost_of_equity (7.30%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.47) + 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.