8305.HK
Tong Kee (Holding) Ltd
Price:  
0.29 
HKD
Volume:  
920,000.00
Hong Kong | Construction & Engineering
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8305.HK WACC - Weighted Average Cost of Capital

The WACC of Tong Kee (Holding) Ltd (8305.HK) is 5.8%.

The Cost of Equity of Tong Kee (Holding) Ltd (8305.HK) is 5.80%.
The Cost of Debt of Tong Kee (Holding) Ltd (8305.HK) is 7.95%.

Range Selected
Cost of equity 4.90% - 6.70% 5.80%
Tax rate 1.50% - 2.10% 1.80%
Cost of debt 7.00% - 8.90% 7.95%
WACC 4.9% - 6.8% 5.8%
WACC

8305.HK WACC calculation

Category Low High
Long-term bond rate 2.9% 3.4%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.33 0.41
Additional risk adjustments 0.0% 0.5%
Cost of equity 4.90% 6.70%
Tax rate 1.50% 2.10%
Debt/Equity ratio 0.02 0.02
Cost of debt 7.00% 8.90%
After-tax WACC 4.9% 6.8%
Selected WACC 5.8%

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 (5.80%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.33) + 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.