002546.SZ WACC - Weighted Average Cost of Capital

The WACC of Nanjing Xinlian Electronics Co Ltd (002546.SZ) is 11.1%.

The Cost of Equity of Nanjing Xinlian Electronics Co Ltd (002546.SZ) is 11.35%.

The Cost of Debt of Nanjing Xinlian Electronics Co Ltd (002546.SZ) is 5.00%.

	Range	Selected
Cost of equity	9.70% - 13.00%	11.35%
Tax rate	12.40% - 16.50%	14.45%
Cost of debt	5.00% - 5.00%	5.00%
WACC	9.5% - 12.6%	11.1%

WACC

002546.SZ WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	6.1%	7.1%
Adjusted beta	1.15	1.31

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.70%	13.00%

Tax rate	12.40%	16.50%
Debt/Equity ratio	0.04	0.04
Cost of debt	5.00%	5.00%

After-tax WACC	9.5%	12.6%


Selected WACC	11.1%

002546.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 002546.SZ:

cost_of_equity (11.35%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.15) + 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.