300586.SZ WACC - Weighted Average Cost of Capital

The WACC of Malion New Materials Co Ltd (300586.SZ) is 9.4%.

The Cost of Equity of Malion New Materials Co Ltd (300586.SZ) is 10.35%.

The Cost of Debt of Malion New Materials Co Ltd (300586.SZ) is 5.00%.

	Range	Selected
Cost of equity	9.20% - 11.50%	10.35%
Tax rate	10.40% - 12.50%	11.45%
Cost of debt	5.00% - 5.00%	5.00%
WACC	8.5% - 10.4%	9.4%

WACC

300586.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	1.1

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.20%	11.50%

Tax rate	10.40%	12.50%
Debt/Equity ratio	0.18	0.18
Cost of debt	5.00%	5.00%

After-tax WACC	8.5%	10.4%


Selected WACC	9.4%

300586.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 300586.SZ:

cost_of_equity (10.35%) = 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.