002302.SZ WACC - Weighted Average Cost of Capital
The WACC of China West Construction Group Co Ltd (002302.SZ) is 6.4%.
| Range | Selected | |
| Cost of equity | 6.7% - 8.8% | 7.75% |
| Tax rate | 18.6% - 19.5% | 19.05% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.7% - 7.1% | 6.4% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.65 | 0.73 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.7% | 8.8% |
| Tax rate | 18.6% | 19.5% |
| Debt/Equity ratio | 0.57 | 0.57 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.7% | 7.1% |
| Selected WACC | 6.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002302.SZ | China West Construction Group Co Ltd | 0.57 | 1.31 | 0.9 |
| 000012.SZ | CSG Holding Co Ltd | 1.11 | 0.88 | 0.47 |
| 000789.SZ | Jiangxi Wannianqing Cement Co Ltd | 0.62 | 1.3 | 0.87 |
| 000877.SZ | Xinjiang Tianshan Cement Co Ltd | 4.03 | 1.36 | 0.32 |
| 002066.SZ | Ruitai Materials Technology Co Ltd | 0.86 | 0.75 | 0.44 |
| 1252.HK | China Tianrui Group Cement Co Ltd | 14.96 | 0.06 | 0 |
| 1847.HK | YCIH Green High Performance Concrete Co Ltd | 13.5 | 0.06 | 0 |
| 2233.HK | West China Cement Ltd | 1.14 | 0.64 | 0.33 |
| 691.HK | China Shanshui Cement Group Ltd | 2.73 | 0.67 | 0.21 |
| 743.HK | Asia Cement (China) Holdings Corp | 0.4 | 0.5 | 0.38 |
| Low | High | |
| Unlevered beta | 0.33 | 0.4 |
| Relevered beta | 0.48 | 0.6 |
| Adjusted relevered beta | 0.65 | 0.73 |
002302.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 002302.SZ:
cost_of_equity (7.75%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.65) + 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.