The WACC of Yihai International Holding Ltd (1579.HK) is 10.6%.
Range | Selected | |
Cost of equity | 9.1% - 12.1% | 10.6% |
Tax rate | 27.9% - 28.4% | 28.15% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 9.1% - 12.1% | 10.6% |
Category | Low | High |
Long-term bond rate | 2.9% | 3.4% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 1.05 | 1.18 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.1% | 12.1% |
Tax rate | 27.9% | 28.4% |
Debt/Equity ratio | 0.01 | 0.01 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 9.1% | 12.1% |
Selected WACC | 10.6% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
1579.HK | Yihai International Holding Ltd | 0.01 | 1.26 | 1.25 |
002299.SZ | Fujian Sunner Development Co Ltd | 0.42 | 1.23 | 0.95 |
002507.SZ | Chongqing Fuling Zhacai Group Co Ltd | 0 | 1.15 | 1.15 |
151.HK | Want Want China Holdings Ltd | 0.07 | 0.35 | 0.33 |
600298.SS | Angel Yeast Co Ltd | 0.22 | 0.44 | 0.38 |
600872.SS | Jonjee Hi-tech Industrial and Commercial Holding Co Ltd | 0.05 | 1.54 | 1.49 |
603156.SS | Hebei Yangyuan ZhiHui Beverage Co Ltd | 0.05 | 0.85 | 0.82 |
603317.SS | Sichuan Teway Food Group Co Ltd | 0 | 1.49 | 1.49 |
603345.SS | Fujian Anjoy Foods Co Ltd | 0.02 | 1.52 | 1.5 |
603866.SS | Toly Bread Co Ltd | 0.14 | 1.41 | 1.28 |
Low | High | |
Unlevered beta | 1.07 | 1.26 |
Relevered beta | 1.07 | 1.27 |
Adjusted relevered beta | 1.05 | 1.18 |
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 1579.HK:
cost_of_equity (10.60%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (1.05) + 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.