8081.HK WACC - Weighted Average Cost of Capital

The WACC of Hang Tai Yue Group Holdings Ltd (8081.HK) is 7.9%.

The Cost of Equity of Hang Tai Yue Group Holdings Ltd (8081.HK) is 8.70%.

The Cost of Debt of Hang Tai Yue Group Holdings Ltd (8081.HK) is 6.00%.

	Range	Selected
Cost of equity	6.90% - 10.50%	8.70%
Tax rate	2.80% - 6.30%	4.55%
Cost of debt	5.00% - 7.00%	6.00%
WACC	6.4% - 9.5%	7.9%

WACC

8081.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.67	0.95

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.90%	10.50%

Tax rate	2.80%	6.30%
Debt/Equity ratio	0.34	0.34
Cost of debt	5.00%	7.00%

After-tax WACC	6.4%	9.5%


Selected WACC	7.9%

8081.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 8081.HK:

cost_of_equity (8.70%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.67) + 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.