002432.SZ
Andon Health Co Ltd
Price:  
39.25 
CNY
Volume:  
26,672,784
China | Health Care Equipment & Supplies

002432.SZ WACC - Weighted Average Cost of Capital

The WACC of Andon Health Co Ltd (002432.SZ) is 11.4%.

The Cost of Equity of Andon Health Co Ltd (002432.SZ) is 12.7%.
The Cost of Debt of Andon Health Co Ltd (002432.SZ) is 5%.

RangeSelected
Cost of equity11.0% - 14.4%12.7%
Tax rate8.4% - 11.7%10.05%
Cost of debt5.0% - 5.0%5%
WACC9.9% - 12.8%11.4%
WACC

002432.SZ WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta1.351.51
Additional risk adjustments0.0%0.5%
Cost of equity11.0%14.4%
Tax rate8.4%11.7%
Debt/Equity ratio
0.190.19
Cost of debt5.0%5.0%
After-tax WACC9.9%12.8%
Selected WACC11.4%

002432.SZ WACC - Detailed calculations of Beta

LowHigh
Unlevered beta1.31.5
Relevered beta1.521.76
Adjusted relevered beta1.351.51

002432.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 002432.SZ:

cost_of_equity (12.70%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.35) + 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.