300462.SZ
Shanghai Huaming Intelligent Terminal Equipment Co Ltd
Price:  
9.64 
CNY
Volume:  
3,569,800.00
China | Machinery
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300462.SZ WACC - Weighted Average Cost of Capital

The WACC of Shanghai Huaming Intelligent Terminal Equipment Co Ltd (300462.SZ) is 9.6%.

The Cost of Equity of Shanghai Huaming Intelligent Terminal Equipment Co Ltd (300462.SZ) is 10.45%.
The Cost of Debt of Shanghai Huaming Intelligent Terminal Equipment Co Ltd (300462.SZ) is 5.00%.

Range Selected
Cost of equity 9.20% - 11.70% 10.45%
Tax rate 6.70% - 9.60% 8.15%
Cost of debt 5.00% - 5.00% 5.00%
WACC 8.6% - 10.7% 9.6%
WACC

300462.SZ WACC calculation

Category Low High
Long-term bond rate 2.7% 3.2%
Equity market risk premium 6.1% 7.1%
Adjusted beta 1.06 1.12
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.20% 11.70%
Tax rate 6.70% 9.60%
Debt/Equity ratio 0.15 0.15
Cost of debt 5.00% 5.00%
After-tax WACC 8.6% 10.7%
Selected WACC 9.6%

300462.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 300462.SZ:

cost_of_equity (10.45%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.06) + 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.