002665.SZ WACC - Weighted Average Cost of Capital
The WACC of Shouhang High Tech Energy Co Ltd (002665.SZ) is 8.1%.
| Range | Selected | |
| Cost of equity | 11.8% - 19.3% | 15.55% |
| Tax rate | 13.1% - 13.8% | 13.45% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.8% - 9.3% | 8.1% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.49 | 2.2 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.8% | 19.3% |
| Tax rate | 13.1% | 13.8% |
| Debt/Equity ratio | 2.01 | 2.01 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.8% | 9.3% |
| Selected WACC | 8.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002665.SZ | Shouhang High Tech Energy Co Ltd | 2.01 | 2.02 | 0.74 |
| 002162.SZ | Everjoy Health Group Co Ltd | 0.17 | 1.2 | 1.05 |
| 002205.SZ | XinJiang GuoTong Pipeline Co Ltd | 1.05 | 0.9 | 0.47 |
| 003011.SZ | Zhejiang Walrus New Material Co Ltd | 0.27 | 1.23 | 1 |
| 1937.HK | Jiachen Holding Group Ltd | 0.34 | 0.44 | 0.34 |
| 300004.SZ | Nanfang Ventilator Co Ltd | 0.01 | 1.29 | 1.28 |
| 300198.SZ | Fujian Superpipe Co Ltd | 0.41 | 1.9 | 1.4 |
| 300260.SZ | Kunshan Kinglai Hygienic Materials Co Ltd | 0.12 | 1.59 | 1.44 |
| 600202.SS | Harbin Air Conditioning Co Ltd | 0.65 | 0.74 | 0.48 |
| 8646.HK | China Hongguang Holdings Ltd | 0.49 | -0.6 | -0.42 |
| Low | High | |
| Unlevered beta | 0.63 | 1.02 |
| Relevered beta | 1.73 | 2.79 |
| Adjusted relevered beta | 1.49 | 2.2 |
002665.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 002665.SZ:
cost_of_equity (15.55%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.49) + 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.