300860.SZ WACC - Weighted Average Cost of Capital

The WACC of Beijing FengShangShiJi Culture Media Co Ltd (300860.SZ) is 12.3%.

The Cost of Equity of Beijing FengShangShiJi Culture Media Co Ltd (300860.SZ) is 12.35%.

The Cost of Debt of Beijing FengShangShiJi Culture Media Co Ltd (300860.SZ) is 5.00%.

	Range	Selected
Cost of equity	10.90% - 13.80%	12.35%
Tax rate	23.10% - 25.20%	24.15%
Cost of debt	5.00% - 5.00%	5.00%
WACC	10.8% - 13.8%	12.3%

WACC

300860.SZ WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	6.1%	7.1%
Adjusted beta	1.34	1.43

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.90%	13.80%

Tax rate	23.10%	25.20%
Debt/Equity ratio	0.01	0.01
Cost of debt	5.00%	5.00%

After-tax WACC	10.8%	13.8%


Selected WACC	12.3%

300860.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 300860.SZ:

cost_of_equity (12.35%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.34) + 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.