1858.HK WACC - Weighted Average Cost of Capital
The WACC of Beijing Chunlizhengda Medical Instruments Co Ltd (1858.HK) is 8.7%.
| Range | Selected | |
| Cost of equity | 7.4% - 10.1% | 8.75% |
| Tax rate | 13.3% - 13.6% | 13.45% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.4% - 10.0% | 8.7% |
| Category | Low | High |
| Long-term bond rate | 2.1% | 2.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 0.91 | 1.02 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.4% | 10.1% |
| Tax rate | 13.3% | 13.6% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.4% | 10.0% |
| Selected WACC | 8.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 1858.HK | Beijing Chunlizhengda Medical Instruments Co Ltd | 0 | -0.2 | -0.19 |
| 300246.SZ | Guangdong Biolight Meditech Co Ltd | 0.36 | 1.33 | 1.02 |
| 300273.SZ | Zhuhai Hokai Medical Instruments Co Ltd | 5.84 | 0.01 | 0 |
| 300318.SZ | Beijing Bohui Innovation Biotechnology Co Ltd | 0.27 | 1.18 | 0.96 |
| 300326.SZ | Shanghai Kinetic Medical Co Ltd | 0.06 | 1.52 | 1.44 |
| 300358.SZ | Truking Technology Ltd | 0.68 | 1.64 | 1.03 |
| 300396.SZ | Dirui Industrial Co Ltd | 0.18 | 2 | 1.73 |
| 300412.SZ | Zhejiang Canaan Technology Ltd | 0.2 | 1.73 | 1.48 |
| 300562.SZ | Guangdong Transtek Medical Electronics Co Ltd | 0.11 | 1.55 | 1.41 |
| 600055.SS | Beijing Wandong Medical Technology Co Ltd | 0.01 | 1.26 | 1.25 |
| 603301.SS | Zhende Medical Co Ltd | 0.11 | 0.99 | 0.91 |
| Low | High | |
| Unlevered beta | 1.02 | 1.25 |
| Relevered beta | 0.87 | 1.03 |
| Adjusted relevered beta | 0.91 | 1.02 |
1858.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 1858.HK:
cost_of_equity (8.75%) = risk_free_rate (2.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.91) + 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.