000606.SZ WACC - Weighted Average Cost of Capital
The WACC of Shunliban Information Service Co Ltd (000606.SZ) is 11.2%.
| Range | Selected | |
| Cost of equity | 10.4% - 13.0% | 11.7% |
| Tax rate | 1.7% - 3.1% | 2.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 10.0% - 12.4% | 11.2% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.26 | 1.31 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.4% | 13.0% |
| Tax rate | 1.7% | 3.1% |
| Debt/Equity ratio | 0.07 | 0.07 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 10.0% | 12.4% |
| Selected WACC | 11.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 000606.SZ | Shunliban Information Service Co Ltd | 0.07 | -0.43 | -0.4 |
| 002279.SZ | Beijing Join-Cheer Software Co Ltd | 0.01 | 1.52 | 1.51 |
| 003007.SZ | Beijing ZZNodeTechnologies Co Ltd | 0.01 | 1.22 | 1.21 |
| 1297.HK | Sinosoft Technology Group Ltd | 0.14 | 0.49 | 0.44 |
| 1745.HK | Lvji Technology Holdings Inc | 0.2 | 1.24 | 1.04 |
| 300520.SZ | GuoChuang Software Co Ltd | 0.16 | 1.81 | 1.56 |
| 300571.SZ | Hangzhou Anysoft Information Technology Co Ltd | 0.39 | 1.75 | 1.26 |
| 300598.SZ | ArcherMind Technology Nanjing Co Ltd | 0.06 | 1.44 | 1.36 |
| 300608.SZ | SI-TECH Information Technology Co Ltd | 0.19 | 1.6 | 1.35 |
| 300830.SZ | JinXianDai Information Industry Co Ltd | 0.05 | 1.52 | 1.45 |
| Low | High | |
| Unlevered beta | 1.24 | 1.36 |
| Relevered beta | 1.39 | 1.46 |
| Adjusted relevered beta | 1.26 | 1.31 |
000606.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 000606.SZ:
cost_of_equity (11.70%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.26) + 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.