002683.SZ WACC - Weighted Average Cost of Capital
The WACC of Guangdong HongDa Blasting Co Ltd (002683.SZ) is 9.3%.
| Range | Selected | |
| Cost of equity | 9.5% - 12.2% | 10.85% |
| Tax rate | 13.7% - 14.1% | 13.9% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.2% - 10.3% | 9.3% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.11 | 1.2 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.5% | 12.2% |
| Tax rate | 13.7% | 14.1% |
| Debt/Equity ratio | 0.31 | 0.31 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.2% | 10.3% |
| Selected WACC | 9.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002683.SZ | Guangdong HongDa Blasting Co Ltd | 0.31 | 0.9 | 0.71 |
| 000603.SZ | Shengda Resources Co Ltd | 0.16 | 0.97 | 0.85 |
| 000831.SZ | China Minmetals Rare Earth Co Ltd | 0.01 | 1.07 | 1.07 |
| 000975.SZ | Yintai Gold Co Ltd | 0.03 | 0.26 | 0.25 |
| 002978.SZ | Sichuan Anning Iron and Titanium Co Ltd | 0.04 | 1.37 | 1.33 |
| 300618.SZ | Nanjing Hanrui Cobalt Co Ltd | 0.17 | 2.03 | 1.77 |
| 600259.SS | Rising Nonferrous Metals Share Co Ltd | 0.19 | 0.95 | 0.82 |
| 600392.SS | Shenghe Resources Holding Co Ltd | 0.22 | 1.2 | 1.01 |
| 601958.SS | Jinduicheng Molybdenum Co Ltd | 0 | 0.95 | 0.94 |
| 603979.SS | JCHX Mining Management Co Ltd | 0.17 | 1.18 | 1.03 |
| Low | High | |
| Unlevered beta | 0.91 | 1.02 |
| Relevered beta | 1.16 | 1.3 |
| Adjusted relevered beta | 1.11 | 1.2 |
002683.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 002683.SZ:
cost_of_equity (10.85%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.11) + 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.