000591.SZ WACC - Weighted Average Cost of Capital
The WACC of CECEP Solar Energy Co Ltd (000591.SZ) is 6.6%.
| Range | Selected | |
| Cost of equity | 8.7% - 10.8% | 9.75% |
| Tax rate | 15.4% - 16.8% | 16.1% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.2% - 7.0% | 6.6% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.98 | 1 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.7% | 10.8% |
| Tax rate | 15.4% | 16.8% |
| Debt/Equity ratio | 1.31 | 1.31 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.2% | 7.0% |
| Selected WACC | 6.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 000591.SZ | CECEP Solar Energy Co Ltd | 1.31 | 1.09 | 0.52 |
| 000791.SZ | GEPIC Energy Development Co Ltd | 0.83 | 0.79 | 0.47 |
| 002039.SZ | Guizhou Qianyuan Power Co Ltd | 1.16 | 0.67 | 0.34 |
| 1798.HK | China Datang Corp Renewable Power Co Ltd | 4.52 | 0.67 | 0.14 |
| 3868.HK | Xinyi Energy Holdings Ltd | 1.03 | 1.14 | 0.61 |
| 600163.SS | Zhongmin Energy Co Ltd | 0.35 | 0.6 | 0.47 |
| 601016.SS | CECEP Wind-Power Corp | 1.25 | 1.01 | 0.49 |
| 601619.SS | Ningxia Jiaze Renewables Corp Ltd | 1.5 | 1.03 | 0.46 |
| 601778.SS | Jinko Power Technology Co Ltd | 2.24 | 1.25 | 0.44 |
| 603693.SS | Jiangsu New Energy Development Co Ltd | 0.74 | 1.04 | 0.64 |
| Low | High | |
| Unlevered beta | 0.46 | 0.48 |
| Relevered beta | 0.97 | 1 |
| Adjusted relevered beta | 0.98 | 1 |
000591.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 000591.SZ:
cost_of_equity (9.75%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.98) + 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.