002560.SZ WACC - Weighted Average Cost of Capital
The WACC of Henan Tong-Da Cable Co Ltd (002560.SZ) is 9.2%.
| Range | Selected | |
| Cost of equity | 10.4% - 13.4% | 11.9% |
| Tax rate | 18.8% - 20.0% | 19.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.2% - 10.2% | 9.2% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.26 | 1.36 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.4% | 13.4% |
| Tax rate | 18.8% | 20.0% |
| Debt/Equity ratio | 0.52 | 0.52 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.2% | 10.2% |
| Selected WACC | 9.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002560.SZ | Henan Tong-Da Cable Co Ltd | 0.52 | 1.37 | 0.96 |
| 002339.SZ | Integrated Electronic Systems Lab Co Ltd | 0.22 | 1.35 | 1.15 |
| 002823.SZ | Shenzhen Kaizhong Precision Technology Co Ltd | 0.24 | 1.25 | 1.05 |
| 002953.SZ | GuangDong Rifeng Electric Cable Co Ltd | 0.26 | 1.12 | 0.93 |
| 300032.SZ | Jinlong Machinery & Electronic Co Ltd | 0.07 | 1.77 | 1.67 |
| 300265.SZ | Jiangsu Tongguang Electronic Wire&Cable Co Ltd | 0.15 | 1.45 | 1.3 |
| 300444.SZ | Beijing Sojo Electric Co Ltd | 0.44 | 1.34 | 0.99 |
| 300697.SZ | Jiangyin Electrical Alloy Co Ltd | 0.09 | 1.26 | 1.18 |
| 580.HK | Sun.King Technology Group Ltd | 0.08 | 0.83 | 0.77 |
| 603333.SS | Sunway Co Ltd | 0.14 | 0.86 | 0.77 |
| Low | High | |
| Unlevered beta | 0.98 | 1.09 |
| Relevered beta | 1.39 | 1.54 |
| Adjusted relevered beta | 1.26 | 1.36 |
002560.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 002560.SZ:
cost_of_equity (11.90%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.26) + 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.