2201.TW
Yulon Motor Co Ltd
Price:  
33.85 
TWD
Volume:  
2,385,987
Taiwan, Province of China | Automobiles

2201.TW WACC - Weighted Average Cost of Capital

The WACC of Yulon Motor Co Ltd (2201.TW) is 7.7%.

The Cost of Equity of Yulon Motor Co Ltd (2201.TW) is 21.85%.
The Cost of Debt of Yulon Motor Co Ltd (2201.TW) is 7.25%.

RangeSelected
Cost of equity15.0% - 28.7%21.85%
Tax rate20.8% - 23.1%21.95%
Cost of debt4.0% - 10.5%7.25%
WACC4.7% - 10.7%7.7%
WACC

2201.TW WACC calculation

CategoryLowHigh
Long-term bond rate2.0%2.5%
Equity market risk premium6.0%7.0%
Adjusted beta2.173.67
Additional risk adjustments0.0%0.5%
Cost of equity15.0%28.7%
Tax rate20.8%23.1%
Debt/Equity ratio
6.886.88
Cost of debt4.0%10.5%
After-tax WACC4.7%10.7%
Selected WACC7.7%

2201.TW'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 2201.TW:

cost_of_equity (21.85%) = risk_free_rate (2.25%) + equity_risk_premium (6.50%) * adjusted_beta (2.17) + 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.