The WACC of Jiangsu JieJie Microelectronics Co Ltd (300623.SZ) is 10.6%.
Range | Selected | |
Cost of equity | 9.5% - 12.3% | 10.9% |
Tax rate | 9.6% - 13.2% | 11.4% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 9.3% - 11.9% | 10.6% |
Category | Low | High |
Long-term bond rate | 2.7% | 3.2% |
Equity market risk premium | 6.1% | 7.1% |
Adjusted beta | 1.12 | 1.21 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.5% | 12.3% |
Tax rate | 9.6% | 13.2% |
Debt/Equity ratio | 0.05 | 0.05 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 9.3% | 11.9% |
Selected WACC | 10.6% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
300623.SZ | Jiangsu JieJie Microelectronics Co Ltd | 0.05 | 1.83 | 1.76 |
002119.SZ | Ningbo Kangqiang Electronics Co Ltd | 0.12 | 1.16 | 1.04 |
300236.SZ | Shanghai Sinyang Semiconductor Materials Co Ltd | 0.05 | 1.38 | 1.32 |
300842.SZ | Wuxi DK Electronic Materials Co Ltd | 0.78 | 1.74 | 1.03 |
300861.SZ | Yangling Metron New Material Co Ltd | 0.02 | 1.8 | 1.76 |
603212.SS | Cybrid Technologies Inc | 0.2 | 1.41 | 1.2 |
605358.SS | Hangzhou Lion Electronics Co Ltd | 0.61 | 1.59 | 1.04 |
688019.SS | Anji Microelectronics Technology Shanghai Co Ltd | 0.02 | 1.26 | 1.24 |
688200.SS | Beijing Huafeng Test & Control Technology Co Ltd | 0 | 1.29 | 1.29 |
968.HK | Xinyi Solar Holdings Ltd | 0.48 | 1.31 | 0.93 |
Low | High | |
Unlevered beta | 1.14 | 1.26 |
Relevered beta | 1.18 | 1.31 |
Adjusted relevered beta | 1.12 | 1.21 |
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 300623.SZ:
cost_of_equity (10.90%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.12) + 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.