The WACC of Pico Far East Holdings Ltd (752.HK) is 8.3%.
Range | Selected | |
Cost of equity | 7.2% - 11.2% | 9.2% |
Tax rate | 16.3% - 17.4% | 16.85% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 6.6% - 10.0% | 8.3% |
Category | Low | High |
Long-term bond rate | 2.9% | 3.4% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 0.72 | 1.04 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.2% | 11.2% |
Tax rate | 16.3% | 17.4% |
Debt/Equity ratio | 0.18 | 0.18 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 6.6% | 10.0% |
Selected WACC | 8.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
752.HK | Pico Far East Holdings Ltd | 0.18 | 0.4 | 0.35 |
002878.SZ | Beijing Yuanlong Yato Culture Dissemination Co Ltd | 0.11 | 1.08 | 0.99 |
1993.HK | Asiaray Media Group Ltd | 4.39 | 0.34 | 0.07 |
205.HK | SEEC Media Group Ltd | 0.13 | 1.92 | 1.74 |
300612.SZ | Shunya International Martech Beijing Co Ltd | 0.02 | 1.52 | 1.49 |
4767.T | TOW Co Ltd | 0.06 | 0.57 | 0.55 |
8130.HK | Dadi International Group Ltd | 16.06 | 0.82 | 0.06 |
888.HK | Bison Finance Group Ltd | 0.76 | 1.45 | 0.88 |
9625.T | Cerespo Co Ltd | 0.09 | 0.47 | 0.44 |
ARIP.BK | ARIP PCL | 0 | 1.72 | 1.72 |
Low | High | |
Unlevered beta | 0.51 | 0.93 |
Relevered beta | 0.58 | 1.06 |
Adjusted relevered beta | 0.72 | 1.04 |
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 752.HK:
cost_of_equity (9.20%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.72) + 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.