000055.SZ WACC - Weighted Average Cost of Capital
The WACC of China Fangda Group Co Ltd (000055.SZ) is 7.9%.
| Range | Selected | |
| Cost of equity | 9.8% - 13.8% | 11.8% |
| Tax rate | 12.7% - 13.8% | 13.25% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.0% - 8.9% | 7.9% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.16 | 1.41 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.8% | 13.8% |
| Tax rate | 12.7% | 13.8% |
| Debt/Equity ratio | 1.06 | 1.06 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.0% | 8.9% |
| Selected WACC | 7.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 000055.SZ | China Fangda Group Co Ltd | 1.06 | 1.11 | 0.58 |
| 000619.SZ | Wuhu Conch Profiles and Science Co Ltd | 0.54 | 1.17 | 0.8 |
| 002084.SZ | Guangzhou Seagull Kitchen and Bath Products Co Ltd | 0.53 | 0.82 | 0.56 |
| 002631.SZ | Der Future Science and Technology Holding Group Co Ltd | 0.14 | 1.16 | 1.04 |
| 300117.SZ | Beijing JIAYU Door Window and Curtain Wall Joint-Stock Co Ltd | 1.62 | 0.77 | 0.32 |
| 600293.SS | Hubei Sanxia New Building Materials Co Ltd | 0.23 | 1.09 | 0.9 |
| 600876.SS | Luoyang Glass Co Ltd | 1.31 | 1.11 | 0.52 |
| 603385.SS | Huida Sanitary Ware Co Ltd | 0.19 | 1.22 | 1.05 |
| 603408.SS | Runner Xiamen Corp | 0.11 | 1.04 | 0.95 |
| 603856.SS | Shandong Donghong Pipe Industry Co Ltd | 0.29 | 0.86 | 0.69 |
| Low | High | |
| Unlevered beta | 0.64 | 0.84 |
| Relevered beta | 1.24 | 1.61 |
| Adjusted relevered beta | 1.16 | 1.41 |
000055.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 000055.SZ:
cost_of_equity (11.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.16) + 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.