000670.SZ
Infotmic Co Ltd
Price:  
8.33 
CNY
Volume:  
301,579,520
China | Semiconductors & Semiconductor Equipment

000670.SZ WACC - Weighted Average Cost of Capital

The WACC of Infotmic Co Ltd (000670.SZ) is 10.7%.

The Cost of Equity of Infotmic Co Ltd (000670.SZ) is 11.75%.
The Cost of Debt of Infotmic Co Ltd (000670.SZ) is 5%.

RangeSelected
Cost of equity9.8% - 13.7%11.75%
Tax rate33.1% - 40.8%36.95%
Cost of debt5.0% - 5.0%5%
WACC9.0% - 12.4%10.7%
WACC

000670.SZ WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta1.161.41
Additional risk adjustments0.0%0.5%
Cost of equity9.8%13.7%
Tax rate33.1%40.8%
Debt/Equity ratio
0.140.14
Cost of debt5.0%5.0%
After-tax WACC9.0%12.4%
Selected WACC10.7%

000670.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 000670.SZ:

cost_of_equity (11.75%) = 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.