8450.HK WACC - Weighted Average Cost of Capital
The WACC of EDICO Holdings Ltd (8450.HK) is 6.2%.
| Range | Selected | |
| Cost of equity | 5.1% - 7.2% | 6.15% |
| Tax rate | 2.9% - 9.3% | 6.1% |
| Cost of debt | 7.0% - 7.5% | 7.25% |
| WACC | 5.2% - 7.2% | 6.2% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.21 | 0.34 |
| Additional risk adjustments | 1.0% | 1.5% |
| Cost of equity | 5.1% | 7.2% |
| Tax rate | 2.9% | 9.3% |
| Debt/Equity ratio | 0.02 | 0.02 |
| Cost of debt | 7.0% | 7.5% |
| After-tax WACC | 5.2% | 7.2% |
| Selected WACC | 6.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 8450.HK | EDICO Holdings Ltd | 0.02 | -0.87 | -0.85 |
| 1481.HK | Smart Globe Holdings Ltd | 0.02 | -0.37 | -0.36 |
| 1540.HK | Left Field Printing Group Ltd | 0.05 | -0.16 | -0.16 |
| 1631.HK | REF Holdings Ltd | 0.28 | 0.96 | 0.75 |
| 1841.HK | A.Plus Group Holdings Ltd | 0.07 | 0.34 | 0.32 |
| 534190.BO | Olympic Cards Ltd | 5.18 | 0.15 | 0.02 |
| 55.HK | Neway Group Holdings Ltd | 4.43 | 0.09 | 0.02 |
| 556.HK | Pan Asia Environmental Protection Group Ltd | 0.02 | -0.51 | -0.5 |
| 8416.HK | HM International Holdings Ltd | 0.49 | 0.02 | 0.01 |
| 8448.HK | Universe Printshop Holdings Ltd | 1.35 | -0.48 | -0.21 |
| Low | High | |
| Unlevered beta | -0.18 | 0.01 |
| Relevered beta | -0.18 | 0.01 |
| Adjusted relevered beta | 0.21 | 0.34 |
8450.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 8450.HK:
cost_of_equity (6.15%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.21) + risk_adjustments (1.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.