300297.SZ WACC - Weighted Average Cost of Capital

The WACC of Bluedon Information Security Technologies Co Ltd (300297.SZ) is 9.9%.

The Cost of Equity of Bluedon Information Security Technologies Co Ltd (300297.SZ) is 78.00%.

The Cost of Debt of Bluedon Information Security Technologies Co Ltd (300297.SZ) is 5.00%.

	Range	Selected
Cost of equity	60.70% - 95.30%	78.00%
Tax rate	3.20% - 7.30%	5.25%
Cost of debt	5.00% - 5.00%	5.00%
WACC	8.8% - 11.1%	9.9%

WACC

300297.SZ WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	6.1%	7.1%
Adjusted beta	9.47	12.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	60.70%	95.30%

Tax rate	3.20%	7.30%
Debt/Equity ratio	13.11	13.11
Cost of debt	5.00%	5.00%

After-tax WACC	8.8%	11.1%


Selected WACC	9.9%

300297.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 300297.SZ:

cost_of_equity (78.00%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (9.47) + 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.