002003.SZ WACC - Weighted Average Cost of Capital
The WACC of Zhejiang Weixing Industrial Development Co Ltd (002003.SZ) is 9.7%.
| Range | Selected | |
| Cost of equity | 8.8% - 11.3% | 10.05% |
| Tax rate | 15.1% - 16.2% | 15.65% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.5% - 10.8% | 9.7% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1 | 1.06 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.8% | 11.3% |
| Tax rate | 15.1% | 16.2% |
| Debt/Equity ratio | 0.07 | 0.07 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.5% | 10.8% |
| Selected WACC | 9.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002003.SZ | Zhejiang Weixing Industrial Development Co Ltd | 0.07 | 0.39 | 0.37 |
| 002154.SZ | Baoxiniao Holding Co Ltd | 0.11 | 1.66 | 1.51 |
| 002345.SZ | Guangdong CHJ Industry Co Ltd | 0.04 | 1.08 | 1.05 |
| 002404.SZ | Zhejiang Jiaxin Silk Corp Ltd | 0.2 | 0.96 | 0.82 |
| 003016.SZ | Xin Hee Co Ltd | 0.13 | 0.93 | 0.84 |
| 1234.HK | China Lilang Ltd | 0.32 | 0.45 | 0.36 |
| 300577.SZ | Anhui Korrun Co Ltd | 0.31 | 1.32 | 1.04 |
| 3818.HK | China Dongxiang (Group) Co Ltd | 0.02 | 1.32 | 1.3 |
| 601566.SS | Joeone Co Ltd | 0.16 | 1.16 | 1.02 |
| 603839.SS | Anzheng Fashion Group Co Ltd | 0.08 | 1.1 | 1.04 |
| Low | High | |
| Unlevered beta | 0.95 | 1.04 |
| Relevered beta | 1 | 1.09 |
| Adjusted relevered beta | 1 | 1.06 |
002003.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 002003.SZ:
cost_of_equity (10.05%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1) + 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.