8659.HK WACC - Weighted Average Cost of Capital
The WACC of Yik Wo International Holdings Ltd (8659.HK) is 8.8%.
| Range | Selected | |
| Cost of equity | 6.8% - 11.1% | 8.95% |
| Tax rate | 31.6% - 33.9% | 32.75% |
| Cost of debt | 4.0% - 5.1% | 4.55% |
| WACC | 6.7% - 10.9% | 8.8% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.66 | 1.04 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.8% | 11.1% |
| Tax rate | 31.6% | 33.9% |
| Debt/Equity ratio | 0.03 | 0.03 |
| Cost of debt | 4.0% | 5.1% |
| After-tax WACC | 6.7% | 10.9% |
| Selected WACC | 8.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 8659.HK | Yik Wo International Holdings Ltd | 0.03 | -0.49 | -0.48 |
| 1440.HK | Deyun Holding Ltd | 0.01 | 0.74 | 0.74 |
| 1455.HK | Fourace Industries Group Holdings Ltd | 0.01 | 0.21 | 0.21 |
| 1643.HK | Modern Chinese Medicine Group Co Ltd | 0 | 0.46 | 0.46 |
| 300908.SZ | Zhongjing Food Co Ltd | 0 | 1.59 | 1.59 |
| 300946.SZ | Hengda New Materials Fujian Co Ltd | 0.02 | 1.65 | 1.62 |
| 6600.HK | SciClone Pharmaceuticals (Holdings) Ltd | 0 | 0.49 | 0.49 |
| 688550.SS | XiAn Manareco New Materials Co Ltd | 0.01 | 1.5 | 1.5 |
| 688687.SS | Beijing Kawin Technology Share-holding Co Ltd | 0.08 | 1.56 | 1.47 |
| 9936.HK | Ximei Resources Holding Ltd | 0.47 | -0.02 | -0.02 |
| Low | High | |
| Unlevered beta | 0.48 | 1.03 |
| Relevered beta | 0.49 | 1.06 |
| Adjusted relevered beta | 0.66 | 1.04 |
8659.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 8659.HK:
cost_of_equity (8.95%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.66) + 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.