000831.SZ WACC - Weighted Average Cost of Capital
The WACC of China Minmetals Rare Earth Co Ltd (000831.SZ) is 10.0%.
| Range | Selected | |
| Cost of equity | 8.7% - 11.4% | 10.05% |
| Tax rate | 16.0% - 19.7% | 17.85% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.7% - 11.3% | 10.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.99 | 1.08 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.7% | 11.4% |
| Tax rate | 16.0% | 19.7% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.7% | 11.3% |
| Selected WACC | 10.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 000831.SZ | China Minmetals Rare Earth Co Ltd | 0.01 | 1.07 | 1.07 |
| 000426.SZ | Inner Mongolia Xingye Mining Co Ltd | 0.06 | 1.48 | 1.41 |
| 000603.SZ | Shengda Resources Co Ltd | 0.16 | 0.97 | 0.86 |
| 000688.SZ | Guocheng Mining Co Ltd | 0.22 | 1.41 | 1.2 |
| 000975.SZ | Yintai Gold Co Ltd | 0.03 | 0.26 | 0.25 |
| 002683.SZ | Guangdong HongDa Blasting Co Ltd | 0.31 | 0.9 | 0.72 |
| 002978.SZ | Sichuan Anning Iron and Titanium Co Ltd | 0.04 | 1.37 | 1.33 |
| 300618.SZ | Nanjing Hanrui Cobalt Co Ltd | 0.17 | 2.03 | 1.79 |
| 600259.SS | Rising Nonferrous Metals Share Co Ltd | 0.19 | 0.95 | 0.83 |
| 603979.SS | JCHX Mining Management Co Ltd | 0.17 | 1.18 | 1.04 |
| Low | High | |
| Unlevered beta | 0.97 | 1.12 |
| Relevered beta | 0.99 | 1.12 |
| Adjusted relevered beta | 0.99 | 1.08 |
000831.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 000831.SZ:
cost_of_equity (10.05%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.99) + 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.