300523.SZ
Beijing Global Safety Technology Co Ltd
Price:  
22.59 
CNY
Volume:  
2,985,261
China | Software

300523.SZ WACC - Weighted Average Cost of Capital

The WACC of Beijing Global Safety Technology Co Ltd (300523.SZ) is 10.5%.

The Cost of Equity of Beijing Global Safety Technology Co Ltd (300523.SZ) is 11.6%.
The Cost of Debt of Beijing Global Safety Technology Co Ltd (300523.SZ) is 5%.

RangeSelected
Cost of equity9.6% - 13.6%11.6%
Tax rate15.4% - 17.6%16.5%
Cost of debt5.0% - 5.0%5%
WACC8.8% - 12.2%10.5%
WACC

300523.SZ WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta1.131.39
Additional risk adjustments0.0%0.5%
Cost of equity9.6%13.6%
Tax rate15.4%17.6%
Debt/Equity ratio
0.180.18
Cost of debt5.0%5.0%
After-tax WACC8.8%12.2%
Selected WACC10.5%

300523.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 300523.SZ:

cost_of_equity (11.60%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.13) + 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.