200468.SZ WACC - Weighted Average Cost of Capital

The WACC of Nanjing Putian Telecommunications Co Ltd (200468.SZ) is 7.4%.

The Cost of Equity of Nanjing Putian Telecommunications Co Ltd (200468.SZ) is 8.35%.

The Cost of Debt of Nanjing Putian Telecommunications Co Ltd (200468.SZ) is 5.00%.

	Range	Selected
Cost of equity	7.10% - 9.60%	8.35%
Tax rate	11.70% - 21.90%	16.80%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.5% - 8.3%	7.4%

WACC

200468.SZ WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.72	0.83

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.10%	9.60%

Tax rate	11.70%	21.90%
Debt/Equity ratio	0.3	0.3
Cost of debt	5.00%	5.00%

After-tax WACC	6.5%	8.3%


Selected WACC	7.4%

200468.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 200468.SZ:

cost_of_equity (8.35%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.72) + 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.