1553.HK WACC - Weighted Average Cost of Capital
The WACC of Maike Tube Industry Holdings Ltd (1553.HK) is 10.5%.
| Range | Selected | |
| Cost of equity | 10.1% - 13.0% | 11.55% |
| Tax rate | 10.6% - 11.6% | 11.1% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 9.2% - 11.8% | 10.5% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 1.22 | 1.31 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.1% | 13.0% |
| Tax rate | 10.6% | 11.6% |
| Debt/Equity ratio | 0.16 | 0.16 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 9.2% | 11.8% |
| Selected WACC | 10.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1553.HK | Maike Tube Industry Holdings Ltd | 0.16 | 0.43 | 0.38 |
| 000890.SZ | Jiangsu Fasten Co Ltd | 0.48 | 1.59 | 1.11 |
| 002290.SZ | Suzhou Hesheng Special Material Co Ltd | 0.09 | 1.44 | 1.33 |
| 002418.SZ | Zhe Jiang Kangsheng Co Ltd | 0.17 | 1.48 | 1.29 |
| 300881.SZ | Shengtak New Material Co Ltd | 0.42 | 1.63 | 1.19 |
| 600608.SS | Shanghai Broadband Technology Co Ltd | 0.06 | 0.56 | 0.54 |
| 600721.SS | Xinjiang Bai Hua Cun Co Ltd | 0 | 1.85 | 1.84 |
| 600725.SS | Yunnan Yunwei Co Ltd | 0.01 | 1.29 | 1.27 |
| 603985.SS | Jiangyin Hengrun Heavy Industries Co Ltd | 0.13 | 1.72 | 1.54 |
| 6890.HK | Kangli International Holdings Ltd | 1.77 | 0.07 | 0.03 |
| Low | High | |
| Unlevered beta | 1.16 | 1.28 |
| Relevered beta | 1.33 | 1.46 |
| Adjusted relevered beta | 1.22 | 1.31 |
1553.HK'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 1553.HK:
cost_of_equity (11.55%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.22) + 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.