300016.SZ
Beijing Beilu Pharmaceutical Co Ltd
Price:  
8.10 
CNY
Volume:  
103,749,100.00
China | Pharmaceuticals
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300016.SZ WACC - Weighted Average Cost of Capital

The WACC of Beijing Beilu Pharmaceutical Co Ltd (300016.SZ) is 8.2%.

The Cost of Equity of Beijing Beilu Pharmaceutical Co Ltd (300016.SZ) is 9.30%.
The Cost of Debt of Beijing Beilu Pharmaceutical Co Ltd (300016.SZ) is 5.00%.

Range Selected
Cost of equity 7.60% - 11.00% 9.30%
Tax rate 15.20% - 38.10% 26.65%
Cost of debt 5.00% - 5.00% 5.00%
WACC 6.9% - 9.4% 8.2%
WACC

300016.SZ WACC calculation

Category Low High
Long-term bond rate 2.7% 3.2%
Equity market risk premium 6.1% 7.1%
Adjusted beta 0.81 1.02
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.60% 11.00%
Tax rate 15.20% 38.10%
Debt/Equity ratio 0.25 0.25
Cost of debt 5.00% 5.00%
After-tax WACC 6.9% 9.4%
Selected WACC 8.2%

300016.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 300016.SZ:

cost_of_equity (9.30%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.81) + 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.