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Kontafarma China HoldingsHKSE:01312 +3.45% WACC % is 5.52% as of Aug. 07, 2026, which is 20% above its 10-year median of 4.59. The stock has 3 warning signs investors should review. Among 1,021 Drug Manufacturers companies, Kontafarma China Holdings ranks better than 73.95% on this metric.
As of today (2026-08-07), Kontafarma China Holdings's weighted average cost of capital is 5.52%%. Kontafarma China Holdings's ROIC % is -20.45% (calculated using TTM income statement data).
Kontafarma China Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
Kontafarma China Holdings (HKSE:01312) WACC % Explanation
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Kontafarma China Holdings's weighted average cost of capital is 5.52%%. Kontafarma China Holdings's ROIC % is -20.45% (calculated using TTM income statement data).
Kontafarma China Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Drug Manufacturers - Specialty & Generic subindustry, Kontafarma China Holdings's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Kontafarma China Holdings WACC % vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Kontafarma China Holdings's WACC % distribution charts can be found below:
* The bar in red indicates where Kontafarma China Holdings's WACC % falls into.
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, Kontafarma China Holdings's market capitalization (E) is HK$167.658 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Dec. 2025, Kontafarma China Holdings's latest one-year semi-annual average Book Value of Debt (D) is HK$245.5777 Mil.
a) weight of equity = E / (E + D) = 167.658 / (167.658 + 245.5777) = 0.4057
b) weight of debt = D / (E + D) = 245.5777 / (167.658 + 245.5777) = 0.5943
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 4.668%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. Kontafarma China Holdings's beta is 0.4182.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 4.668% + 0.4182 * 6% = 7.1772%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
As of Dec. 2025, Kontafarma China Holdings's interest expense (positive number) was HK$10.76 Mil. Its total Book Value of Debt (D) is HK$245.5777 Mil.
Cost of Debt = 10.76 / 245.5777 = 4.3815%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = 27.827 / -454.73 = -6.12%, which is less than 0%. Therefore it's set to 0%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Kontafarma China Holdings (HKSE:01312) has a WACC % of 5.52% as of Aug. 07, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Kontafarma China Holdings and its competitors. This is 20% above median its historical median of 4.59. Over the past decade, Kontafarma China Holdings' WACC % has ranged from 1.88 to 8.93. According to the industry distribution chart, Kontafarma China Holdings ranks #266 out of 1021 companies in the Drug Manufacturers industry, placing it in the top 26.1%.
Is Kontafarma China Holdings' WACC % too high?
Kontafarma China Holdings' current WACC % of 5.52% is 20% above median its 10-year median of 4.59. Over the past 10 years, this metric has ranged from a low of 1.88 to a high of 8.93. The Drug Manufacturers industry median WACC % is 9.04. Kontafarma China Holdings' value of 5.52% is 38.9% below this industry median. Based on the distribution chart, Kontafarma China Holdings ranks #266 out of 1021 companies in the Drug Manufacturers industry, which is above the industry midpoint.
How does Kontafarma China Holdings' WACC % compare to ZTS?
According to the Drug Manufacturers industry distribution chart, Kontafarma China Holdings ranks #266 out of 1021 companies for WACC %. This puts Kontafarma China Holdings in the upper half of its industry. The industry median WACC % is 9.04. Kontafarma China Holdings' value of 5.52% is 38.9% below this benchmark. Historically, Kontafarma China Holdings' own WACC % has ranged from 1.88 to 8.93 over the past decade. While the company's 10-year median is 4.59 vs. the industry median of 9.04, Kontafarma China Holdings has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for a Drug Manufacturers company?
The median WACC % among Drug Manufacturers companies is 9.04, based on 1,021 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Kontafarma China Holdings's current WACC % of 5.52% is 38.9% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Kontafarma China Holdings and its competitors. For the Drug Manufacturers industry, the median WACC % is 9.04 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Kontafarma China Holdings's current WACC % is 5.52%, which is 20% above median its own 10-year median of 4.59. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Kontafarma China Holdings stock overvalued right now?
Based on GuruFocus' analysis, Kontafarma China Holdings (HKSE:01312) is currently considered Modestly Undervalued. The stock's GF Value™ is HK$0.04, compared to a current price of HK$0.03 — trading 25% below its estimated fair value. The current WACC % is 5.52%, which is 20% above median its 10-year median of 4.59 and 38.9% below the Drug Manufacturers industry median of 9.04. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For Kontafarma China Holdings (HKSE:01312), the current WACC % is 5.52% as of Aug. 07, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Kontafarma China Holdings Ltd and its subsidiaries are principally engaged in the pharmaceutical and fitness business. The Group manufactures and sells prescription drugs, including chemical drugs, traditional Chinese medicine prescriptions, active pharmaceutical ingredients, and API intermediates in China, and operates fitness centres, provides fitness and health consultation services, and operates a franchise business for royalty fee income. Its segments are the pharmaceutical business, which generates maximum revenue, and the fitness business. The Group operates in Mainland China, Singapore, Taiwan, and other regions, with maximum revenue from Mainland China.
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