The WACC of Anshan Hifichem Co Ltd (300758.SZ) is 10.4%.
Range | Selected | |
Cost of equity | 10.3% - 13.3% | 11.8% |
Tax rate | 25.0% - 25.0% | 25% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 9.2% - 11.7% | 10.4% |
Category | Low | High |
Long-term bond rate | 2.7% | 3.2% |
Equity market risk premium | 6.1% | 7.1% |
Adjusted beta | 1.25 | 1.35 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 10.3% | 13.3% |
Tax rate | 25.0% | 25.0% |
Debt/Equity ratio | 0.2 | 0.2 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 9.2% | 11.7% |
Selected WACC | 10.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
300758.SZ | Anshan Hifichem Co Ltd | 0.2 | 1.28 | 1.11 |
002915.SZ | Zhejiang Zhongxin Fluoride Materials Co Ltd | 0.22 | 1.27 | 1.09 |
300192.SZ | Suzhou Kingswood Education Technology Co Ltd | 0.02 | 1.95 | 1.93 |
300200.SZ | Beijing Comens New Materials Co Ltd | 0.09 | 1.18 | 1.11 |
300481.SZ | Puyang Huicheng Electronic Material Co Ltd | 0.07 | 1.3 | 1.24 |
603110.SS | New East New Materials Co Ltd | 0.03 | 1.61 | 1.58 |
603155.SS | Xinyaqiang Silicon Chemistry Co Ltd | 0.02 | 1.34 | 1.32 |
603663.SS | Sanxiang Advanced Materials Co Ltd | 0.04 | 0.9 | 0.88 |
603931.SS | Hangzhou Greenda Electronic Materials Co Ltd | 0 | 1.59 | 1.59 |
688357.SS | Luoyang Jalon Micro-Nano New Materials Co Ltd | 0.32 | 1.65 | 1.33 |
Low | High | |
Unlevered beta | 1.19 | 1.32 |
Relevered beta | 1.37 | 1.52 |
Adjusted relevered beta | 1.25 | 1.35 |
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 300758.SZ:
cost_of_equity (11.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.25) + 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.