765.HK WACC - Weighted Average Cost of Capital
The WACC of Perfectech International Holdings Ltd (765.HK) is 6.1%.
| Range | Selected | |
| Cost of equity | 5.5% - 7.6% | 6.55% |
| Tax rate | 7.5% - 24.0% | 15.75% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.3% - 6.9% | 6.1% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.35 | 0.46 |
| Additional risk adjustments | 0.5% | 1.0% |
| Cost of equity | 5.5% | 7.6% |
| Tax rate | 7.5% | 24.0% |
| Debt/Equity ratio | 0.21 | 0.21 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.3% | 6.9% |
| Selected WACC | 6.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 765.HK | Perfectech International Holdings Ltd | 0.21 | 0.59 | 0.5 |
| 1005.HK | Matrix Holdings Ltd | 0.2 | -0.75 | -0.63 |
| 209.HK | Winshine Science Co Ltd | 9.78 | 0.18 | 0.02 |
| 348.HK | China Healthwise Holdings Ltd | 1.58 | 0.87 | 0.36 |
| 361.HK | Sino Golf Holdings Ltd | 0.38 | 0.19 | 0.14 |
| 381.HK | Kiu Hung International Holdings Ltd | 0.47 | -1.96 | -1.38 |
| 413.HK | South China Holdings Co Ltd | 8.89 | 0.29 | 0.03 |
| 8545.HK | Amuse Group Holding Ltd | 0.14 | 0.37 | 0.33 |
| 869.HK | Playmates Toys Ltd | 0.02 | 0.21 | 0.21 |
| 900270.KQ | Heng Sheng Holding Group Ltd | 1.22 | -0.41 | -0.19 |
| Low | High | |
| Unlevered beta | 0.03 | 0.17 |
| Relevered beta | 0.03 | 0.19 |
| Adjusted relevered beta | 0.35 | 0.46 |
765.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 765.HK:
cost_of_equity (6.55%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.35) + risk_adjustments (0.75%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.