300124.SZ WACC - Weighted Average Cost of Capital
The WACC of Shenzhen Inovance Technology Co Ltd (300124.SZ) is 9.5%.
| Range | Selected | |
| Cost of equity | 8.5% - 11.2% | 9.85% |
| Tax rate | 4.1% - 5.0% | 4.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.2% - 10.8% | 9.5% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.95 | 1.06 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.5% | 11.2% |
| Tax rate | 4.1% | 5.0% |
| Debt/Equity ratio | 0.07 | 0.07 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.2% | 10.8% |
| Selected WACC | 9.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 300124.SZ | Shenzhen Inovance Technology Co Ltd | 0.07 | 1.7 | 1.59 |
| 002008.SZ | Han's Laser Technology Industry Group Co Ltd | 0.33 | 1.3 | 0.99 |
| 002050.SZ | Zhejiang Sanhua Intelligent Controls Co Ltd | 0.09 | 1.68 | 1.56 |
| 002532.SZ | Tianshan Aluminum Group Co Ltd | 0.66 | 1.37 | 0.84 |
| 1590.TW | Airtac International Group | 0.03 | 1.16 | 1.13 |
| 1882.HK | Haitian International Holdings Ltd | 0.07 | 0.8 | 0.75 |
| 601100.SS | Jiangsu Hengli Hydraulic Co Ltd | 0.01 | 1.07 | 1.06 |
| 603185.SS | Wuxi Shangji Automation Co Ltd | 1.15 | 1.84 | 0.88 |
| 603338.SS | Zhejiang Dingli Machinery Co Ltd | 0.12 | 0.8 | 0.72 |
| 603638.SS | Yantai Eddie Precision Machinery Co Ltd | 0.15 | 0.85 | 0.74 |
| Low | High | |
| Unlevered beta | 0.86 | 1.02 |
| Relevered beta | 0.93 | 1.09 |
| Adjusted relevered beta | 0.95 | 1.06 |
300124.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 300124.SZ:
cost_of_equity (9.85%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.95) + 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.