300397.SZ WACC - Weighted Average Cost of Capital
The WACC of XiAn Tian He Defense Technology Co Ltd (300397.SZ) is 10.4%.
| Range | Selected | |
| Cost of equity | 9.3% - 12.4% | 10.85% |
| Tax rate | 11.9% - 13.8% | 12.85% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 9.0% - 11.9% | 10.4% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.08 | 1.23 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.3% | 12.4% |
| Tax rate | 11.9% | 13.8% |
| Debt/Equity ratio | 0.07 | 0.07 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 9.0% | 11.9% |
| Selected WACC | 10.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 300397.SZ | XiAn Tian He Defense Technology Co Ltd | 0.07 | 1.39 | 1.32 |
| 000697.SZ | Ligeance Aerospace Technology Co Ltd | 0.45 | 1.48 | 1.06 |
| 002413.SZ | Jiangsu Leike Defense Technology Co Ltd | 0.05 | 1.51 | 1.44 |
| 002977.SZ | Chengdu Tianjian Technology Co Ltd | 0.01 | 1.5 | 1.48 |
| 300722.SZ | Jiangxi Xinyu Guoke Technology Co Ltd | 0 | 0.85 | 0.85 |
| 300875.SZ | Tianjin Jieqiang Power Equipment Co Ltd | 0.01 | 1.32 | 1.31 |
| 300900.SZ | Guanglian Aviation Industry Co Ltd | 0.39 | 1.65 | 1.23 |
| 600184.SS | North Electro-Optic Co Ltd | 0.1 | 1.13 | 1.04 |
| 600391.SS | AECC Aero Science and Technology Co Ltd | 0.33 | 1.19 | 0.92 |
| 601606.SS | Anhui Great Wall Military Industry Co Ltd | 0.08 | 1.11 | 1.04 |
| Low | High | |
| Unlevered beta | 1.05 | 1.27 |
| Relevered beta | 1.12 | 1.34 |
| Adjusted relevered beta | 1.08 | 1.23 |
300397.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 300397.SZ:
cost_of_equity (10.85%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.08) + 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.