The WACC of Infotmic Co Ltd (000670.SZ) is 10.7%.
Range | Selected | |
Cost of equity | 9.8% - 13.7% | 11.75% |
Tax rate | 33.1% - 40.8% | 36.95% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 9.0% - 12.4% | 10.7% |
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% | 13.7% |
Tax rate | 33.1% | 40.8% |
Debt/Equity ratio | 0.14 | 0.14 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 9.0% | 12.4% |
Selected WACC | 10.7% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
000670.SZ | Infotmic Co Ltd | 0.14 | 1.86 | 1.7 |
1679.HK | Risecomm Group Holdings Ltd | 7.35 | 0 | 0 |
300046.SZ | Tech Semiconductors Co Ltd | 0 | 1.85 | 1.85 |
300077.SZ | Nations Technologies Inc | 0.13 | 1.33 | 1.22 |
300111.SZ | Zhejiang Sunflower Great Health Limited Liability Company | 0.02 | 1.45 | 1.43 |
300139.SZ | Beijing Xiaocheng Technology Stock Co Ltd | 0 | 0.72 | 0.72 |
603105.SS | Zhejiang Sunoren Solar Technology Co Ltd | 0.47 | 1.3 | 0.99 |
688589.SS | Leaguer Shenzhen MicroElectronics Corp | 0.11 | 1.84 | 1.72 |
688689.SS | Changzhou Galaxy Century Microelectronics Co Ltd | 0.17 | 1.73 | 1.55 |
712.HK | Comtec Solar Systems Group Ltd | 2.16 | 1.35 | 0.56 |
Low | High | |
Unlevered beta | 1.13 | 1.48 |
Relevered beta | 1.24 | 1.61 |
Adjusted relevered beta | 1.16 | 1.41 |
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.