300264.SZ
AVIT Ltd
Price:  
6.42 
CNY
Volume:  
16,043,900
China | Communications Equipment

300264.SZ WACC - Weighted Average Cost of Capital

The WACC of AVIT Ltd (300264.SZ) is 8.3%.

The Cost of Equity of AVIT Ltd (300264.SZ) is 8.45%.
The Cost of Debt of AVIT Ltd (300264.SZ) is 5%.

RangeSelected
Cost of equity6.4% - 10.5%8.45%
Tax rate0.0% - 0.2%0.1%
Cost of debt5.0% - 5.0%5%
WACC6.3% - 10.3%8.3%
WACC

300264.SZ WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta0.610.96
Additional risk adjustments0.0%0.5%
Cost of equity6.4%10.5%
Tax rate0.0%0.2%
Debt/Equity ratio
0.050.05
Cost of debt5.0%5.0%
After-tax WACC6.3%10.3%
Selected WACC8.3%

300264.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 300264.SZ:

cost_of_equity (8.45%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.61) + 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.