002693.SZ
Hainan Shuangcheng Pharmaceuticals Co Ltd
Price:  
7.06 
CNY
Volume:  
46,872,980
China | Pharmaceuticals

002693.SZ WACC - Weighted Average Cost of Capital

The WACC of Hainan Shuangcheng Pharmaceuticals Co Ltd (002693.SZ) is 9.0%.

The Cost of Equity of Hainan Shuangcheng Pharmaceuticals Co Ltd (002693.SZ) is 9.25%.
The Cost of Debt of Hainan Shuangcheng Pharmaceuticals Co Ltd (002693.SZ) is 5%.

RangeSelected
Cost of equity7.2% - 11.3%9.25%
Tax rate1.3% - 1.4%1.35%
Cost of debt5.0% - 5.0%5%
WACC7.0% - 10.9%9.0%
WACC

002693.SZ WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta0.741.08
Additional risk adjustments0.0%0.5%
Cost of equity7.2%11.3%
Tax rate1.3%1.4%
Debt/Equity ratio
0.070.07
Cost of debt5.0%5.0%
After-tax WACC7.0%10.9%
Selected WACC9.0%

002693.SZ WACC - Detailed calculations of Beta

LowHigh
Unlevered beta0.651.09
Relevered beta0.611.12
Adjusted relevered beta0.741.08

002693.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 002693.SZ:

cost_of_equity (9.25%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.74) + 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.