300686.SZ WACC - Weighted Average Cost of Capital
The WACC of Shenzhen CDL Precision Technology Co Ltd (300686.SZ) is 9.4%.
| Range | Selected | |
| Cost of equity | 8.5% - 11.9% | 10.2% |
| Tax rate | 4.0% - 6.7% | 5.35% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.0% - 10.9% | 9.4% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.95 | 1.16 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.5% | 11.9% |
| Tax rate | 4.0% | 6.7% |
| Debt/Equity ratio | 0.17 | 0.17 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.0% | 10.9% |
| Selected WACC | 9.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 300686.SZ | Shenzhen CDL Precision Technology Co Ltd | 0.17 | 1.49 | 1.28 |
| 002057.SZ | Sinosteel New Materials Co Ltd | 0.16 | 0.98 | 0.85 |
| 002866.SZ | Jiangsu Transimage Technology Co Ltd | 0.2 | 1.11 | 0.94 |
| 002897.SZ | Wenzhou Yihua Connector Co Ltd | 0.31 | 1.77 | 1.38 |
| 300128.SZ | Suzhou Jinfu Technology Co Ltd | 0.15 | 1.76 | 1.54 |
| 600207.SS | Henan Ancai Hi-tech Co Ltd | 0.52 | 0.97 | 0.65 |
| 603186.SS | Zhejiang Wazam New Materials Co Ltd | 0.76 | 1.03 | 0.6 |
| 603626.SS | Kunshan Kersen Science & Technology Co Ltd | 0.37 | 0.36 | 0.27 |
| 603629.SS | Jiangsu Lettall Electronic Co Ltd | 0.44 | 1.77 | 1.25 |
| 603890.SS | Suzhou Chunqiu Electronic Technology Co Ltd | 0.28 | 0.92 | 0.73 |
| Low | High | |
| Unlevered beta | 0.8 | 1.06 |
| Relevered beta | 0.93 | 1.24 |
| Adjusted relevered beta | 0.95 | 1.16 |
300686.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 300686.SZ:
cost_of_equity (10.20%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.95) + 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.