000030.SZ WACC - Weighted Average Cost of Capital
The WACC of FAWER Automotive Parts Ltd Co (000030.SZ) is 9.0%.
| Range | Selected | |
| Cost of equity | 8.8% - 11.8% | 10.3% |
| Tax rate | 2.2% - 2.3% | 2.25% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.9% - 10.1% | 9.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1 | 1.14 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.8% | 11.8% |
| Tax rate | 2.2% | 2.3% |
| Debt/Equity ratio | 0.32 | 0.32 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.9% | 10.1% |
| Selected WACC | 9.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 000030.SZ | FAWER Automotive Parts Ltd Co | 0.32 | 1.26 | 0.96 |
| 000559.SZ | Wanxiang Qianchao Co Ltd | 0.28 | 1.14 | 0.9 |
| 000581.SZ | Weifu High-Technology Group Co Ltd | 0.15 | 0.86 | 0.75 |
| 002048.SZ | Ningbo Huaxiang Electronic Co Ltd | 0.29 | 0.99 | 0.77 |
| 002085.SZ | Zhejiang Wanfeng Auto Wheel Co Ltd | 0.13 | 1.54 | 1.36 |
| 002611.SZ | Guangdong Dongfang Precision Science & Technology Co Ltd | 0.04 | 0.57 | 0.55 |
| 300473.SZ | Fuxin Dare Automotive Parts Co Ltd | 0.19 | 0.83 | 0.7 |
| 600480.SS | Ling Yun Industrial Corp Ltd | 0.25 | 1.55 | 1.24 |
| 603013.SS | YAPP Automotive Systems Co Ltd | 0.02 | 1.07 | 1.05 |
| 603358.SS | Huada Automotive Technology Co Ltd | 0.08 | 0.63 | 0.58 |
| Low | High | |
| Unlevered beta | 0.76 | 0.92 |
| Relevered beta | 1 | 1.21 |
| Adjusted relevered beta | 1 | 1.14 |
000030.SZ'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 000030.SZ:
cost_of_equity (10.30%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1) + 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.