000737.SZ WACC - Weighted Average Cost of Capital
The WACC of Nafine Chemical Industry Group Co Ltd (000737.SZ) is 9.2%.
| Range | Selected | |
| Cost of equity | 9.8% - 14.0% | 11.9% |
| Tax rate | 20.7% - 22.3% | 21.5% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.8% - 10.5% | 9.2% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.17 | 1.44 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.8% | 14.0% |
| Tax rate | 20.7% | 22.3% |
| Debt/Equity ratio | 0.52 | 0.52 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.8% | 10.5% |
| Selected WACC | 9.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 000737.SZ | Nafine Chemical Industry Group Co Ltd | 0.52 | 1.18 | 0.83 |
| 000523.SZ | Lonkey Industrial Co Ltd Guangzhou | 0.16 | 1.63 | 1.45 |
| 002511.SZ | C&S Paper Co Ltd | 0.19 | 1.4 | 1.22 |
| 2222.HK | NVC International Holdings Ltd | 0.02 | 0.79 | 0.77 |
| 600651.SS | Shanghai Feilo Acoustics Co Ltd | 0.1 | 1.47 | 1.36 |
| 603515.SS | Opple Lighting Co Ltd | 0.01 | 1.36 | 1.35 |
| 603630.SS | Lafang China Co Ltd | 0 | 1.15 | 1.15 |
| 6993.HK | Blue Moon Group Holdings Ltd | 0 | 0.59 | 0.58 |
| 7818.T | Transaction Co Ltd | 0.01 | -0.09 | -0.09 |
| EVEREADY.NS | Eveready Industries India Ltd | 0.14 | 1.02 | 0.92 |
| Low | High | |
| Unlevered beta | 0.89 | 1.18 |
| Relevered beta | 1.25 | 1.66 |
| Adjusted relevered beta | 1.17 | 1.44 |
000737.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 000737.SZ:
cost_of_equity (11.90%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.17) + 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.