300775.SZ WACC - Weighted Average Cost of Capital

The WACC of Xi'an Triangle Defense Co Ltd (300775.SZ) is 11.5%.

The Cost of Equity of Xi'an Triangle Defense Co Ltd (300775.SZ) is 12.50%.

The Cost of Debt of Xi'an Triangle Defense Co Ltd (300775.SZ) is 5.00%.

	Range	Selected
Cost of equity	11.00% - 14.00%	12.50%
Tax rate	13.30% - 13.60%	13.45%
Cost of debt	5.00% - 5.00%	5.00%
WACC	10.2% - 12.8%	11.5%

WACC

300775.SZ WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	6.1%	7.1%
Adjusted beta	1.35	1.45

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.00%	14.00%

Tax rate	13.30%	13.60%
Debt/Equity ratio	0.14	0.14
Cost of debt	5.00%	5.00%

After-tax WACC	10.2%	12.8%


Selected WACC	11.5%

300775.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 300775.SZ:

cost_of_equity (12.50%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.35) + 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.