300416.SZ
Suzhou Sushi Testing Group Co Ltd
Price:  
14.27 
CNY
Volume:  
15,182,638
China | Electronic Equipment, Instruments & Components

300416.SZ WACC - Weighted Average Cost of Capital

The WACC of Suzhou Sushi Testing Group Co Ltd (300416.SZ) is 11.0%.

The Cost of Equity of Suzhou Sushi Testing Group Co Ltd (300416.SZ) is 12%.
The Cost of Debt of Suzhou Sushi Testing Group Co Ltd (300416.SZ) is 5%.

RangeSelected
Cost of equity10.5% - 13.5%12%
Tax rate8.6% - 9.5%9.05%
Cost of debt5.0% - 5.0%5%
WACC9.7% - 12.3%11.0%
WACC

300416.SZ WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta1.281.39
Additional risk adjustments0.0%0.5%
Cost of equity10.5%13.5%
Tax rate8.6%9.5%
Debt/Equity ratio
0.160.16
Cost of debt5.0%5.0%
After-tax WACC9.7%12.3%
Selected WACC11.0%

300416.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 300416.SZ:

cost_of_equity (12.00%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.28) + 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.