The WACC of Beijing Philisense Technology Co Ltd (300287.SZ) is 8.9%.
Range | Selected | |
Cost of equity | 7.3% - 10.5% | 8.9% |
Tax rate | 1.8% - 7.3% | 4.55% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 7.2% - 10.5% | 8.9% |
Category | Low | High |
Long-term bond rate | 2.7% | 3.2% |
Equity market risk premium | 6.1% | 7.1% |
Adjusted beta | 0.75 | 0.96 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.3% | 10.5% |
Tax rate | 1.8% | 7.3% |
Debt/Equity ratio | 0 | 0 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 7.2% | 10.5% |
Selected WACC | 8.9% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
300287.SZ | Beijing Philisense Technology Co Ltd | 0.01 | 1.03 | 1.02 |
002184.SZ | Shanghai Hi-Tech Control System Co Ltd | 0.26 | 0.3 | 0.24 |
002331.SZ | Anhui Wantong Technology Co Ltd | 0.1 | 0.94 | 0.86 |
002401.SZ | COSCO SHIPPING Technology Co Ltd | 0.01 | 1.26 | 1.25 |
1075.HK | Capinfo Company Ltd | 0.05 | 0.7 | 0.67 |
1900.HK | China ITS Holdings Co Ltd | 1.17 | 0.74 | 0.34 |
300020.SZ | Enjoyor Co Ltd | 0.54 | 0.84 | 0.55 |
300366.SZ | Troy Information Technology Co Ltd | 0.18 | 1.52 | 1.29 |
300925.SZ | Shenzhen Farben Information Technology Co Ltd | 0.03 | 1.99 | 1.94 |
600242.SS | Zhongchang Big Data Corp Ltd | 3.1 | 1.32 | 0.33 |
Low | High | |
Unlevered beta | 0.62 | 0.92 |
Relevered beta | 0.63 | 0.94 |
Adjusted relevered beta | 0.75 | 0.96 |
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 300287.SZ:
cost_of_equity (8.90%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.75) + 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.