000552.SZ WACC - Weighted Average Cost of Capital
The WACC of Gansu Jingyuan Coal Industry and Electricity Power Co Ltd (000552.SZ) is 8.8%.
| Range | Selected | |
| Cost of equity | 9.5% - 12.5% | 11% |
| Tax rate | 16.4% - 17.4% | 16.9% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.8% - 9.9% | 8.8% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.11 | 1.24 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.5% | 12.5% |
| Tax rate | 16.4% | 17.4% |
| Debt/Equity ratio | 0.46 | 0.46 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.8% | 9.9% |
| Selected WACC | 8.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 000552.SZ | Gansu Jingyuan Coal Industry and Electricity Power Co Ltd | 0.61 | 1.35 | 0.9 |
| 000983.SZ | Shanxi Coking Coal Energy Group Co Ltd | 0.33 | 1.1 | 0.86 |
| 002128.SZ | Huolinhe Opencut Coal Industry Corp Ltd of Inner Mongolia | 0.18 | 0.94 | 0.82 |
| 1277.HK | Kinetic Mines and Energy Ltd | 0.1 | 0.23 | 0.21 |
| 600403.SS | Henan Dayou Energy Co Ltd | 0.61 | 1.49 | 0.99 |
| 600508.SS | Shanghai Datun Energy Resources Co Ltd | 0.27 | 1.29 | 1.05 |
| 600971.SS | Anhui Hengyuan Coal Industry and Electricity Power Co Ltd | 0.26 | 1.28 | 1.05 |
| 601101.SS | Beijing Haohua Energy Resource Co Ltd | 0.62 | 1.16 | 0.76 |
| 601699.SS | Shanxi LuAn Environmental Energy Dev Co Ltd | 0.06 | 1.24 | 1.18 |
| 866.HK | China Qinfa Group Ltd | 0.41 | -0.27 | -0.2 |
| Low | High | |
| Unlevered beta | 0.84 | 0.93 |
| Relevered beta | 1.16 | 1.36 |
| Adjusted relevered beta | 1.11 | 1.24 |
000552.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 000552.SZ:
cost_of_equity (11.00%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.11) + 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.