002959.SZ WACC - Weighted Average Cost of Capital
The WACC of Bear Electric Appliance Co Ltd (002959.SZ) is 10.2%.
| Range | Selected | |
| Cost of equity | 10.4% - 13.3% | 11.85% |
| Tax rate | 14.3% - 14.8% | 14.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 9.0% - 11.3% | 10.2% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.26 | 1.35 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.4% | 13.3% |
| Tax rate | 14.3% | 14.8% |
| Debt/Equity ratio | 0.28 | 0.28 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 9.0% | 11.3% |
| Selected WACC | 10.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002959.SZ | Bear Electric Appliance Co Ltd | 0.28 | 1.5 | 1.21 |
| 002616.SZ | Guangdong Chant Group Inc | 1.47 | 1.05 | 0.47 |
| 002677.SZ | Zhejiang Meida Industrial Co Ltd | 0 | 1.15 | 1.15 |
| 002681.SZ | Shenzhen Fenda Technology Co Ltd | 0.09 | 1.71 | 1.59 |
| 002759.SZ | Guangdong Tonze Electric Co Ltd | 0.44 | 1.73 | 1.26 |
| 300217.SZ | Zhenjiang Dongfang Electric Heating Technology Co Ltd | 0.09 | 1.87 | 1.73 |
| 300879.SZ | Ningbo Daye Garden Machinery Co Ltd | 0.19 | 1.24 | 1.06 |
| 300894.SZ | Marssenger Kitchenware Co Ltd | 0.1 | 1.91 | 1.76 |
| 603355.SS | Kingclean Electric Co Ltd | 0.47 | 0.76 | 0.54 |
| 603551.SS | AUPU Home Style Corp Ltd | 0.06 | 0.79 | 0.75 |
| Low | High | |
| Unlevered beta | 1.12 | 1.23 |
| Relevered beta | 1.39 | 1.52 |
| Adjusted relevered beta | 1.26 | 1.35 |
002959.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 002959.SZ:
cost_of_equity (11.85%) = 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.