8305.HK WACC - Weighted Average Cost of Capital
The WACC of Tong Kee (Holding) Ltd (8305.HK) is 5.9%.
| Range | Selected | |
| Cost of equity | 5.0% - 6.7% | 5.85% |
| Tax rate | 1.5% - 2.1% | 1.8% |
| Cost of debt | 7.0% - 8.9% | 7.95% |
| WACC | 5.0% - 6.8% | 5.9% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.36 | 0.41 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.0% | 6.7% |
| Tax rate | 1.5% | 2.1% |
| Debt/Equity ratio | 0.02 | 0.02 |
| Cost of debt | 7.0% | 8.9% |
| After-tax WACC | 5.0% | 6.8% |
| Selected WACC | 5.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 8305.HK | Tong Kee (Holding) Ltd | 0.02 | -0.09 | -0.09 |
| 1718.HK | Wan Kei Group Holdings Ltd | 3.28 | 0.08 | 0.02 |
| 1757.HK | Affluent Foundation Holdings Ltd | 0.03 | 0.18 | 0.18 |
| 2193.HK | Man King Holdings Ltd | 0.12 | 0.09 | 0.08 |
| 2863.HK | Golden Faith Group Holdings Ltd | 0.01 | 0.36 | 0.35 |
| 8040.HK | DCB Holdings Ltd | 0.56 | -0.42 | -0.27 |
| 8262.HK | Super Strong Holdings Ltd | 0.03 | -0.45 | -0.44 |
| 8445.HK | Noble Engineering Group Holdings Ltd | 0.01 | 0.05 | 0.05 |
| 9929.HK | Sem Holdings Ltd | 0.07 | 0.63 | 0.59 |
| 9938.HK | Wah Wo Holdings Group Ltd | 0.11 | 0.65 | 0.59 |
| Low | High | |
| Unlevered beta | 0.04 | 0.12 |
| Relevered beta | 0.04 | 0.12 |
| Adjusted relevered beta | 0.36 | 0.41 |
8305.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 8305.HK:
cost_of_equity (5.85%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.36) + 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.