600015.SS WACC - Weighted Average Cost of Capital
The WACC of Hua Xia Bank Co Ltd (600015.SS) is 4.6%.
| Range | Selected | |
| Cost of equity | 8.5% - 11.9% | 10.2% |
| Tax rate | 23.0% - 24.1% | 23.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.4% - 4.7% | 4.6% |
| 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 | 23.0% | 24.1% |
| Debt/Equity ratio | 7.68 | 7.68 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.4% | 4.7% |
| Selected WACC | 4.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 600015.SS | Hua Xia Bank Co Ltd | 7.68 | 0.76 | 0.11 |
| 000001.SZ | Ping An Bank Co Ltd | 3.87 | 0.97 | 0.25 |
| 601169.SS | Bank of Beijing Co Ltd | 5.6 | 0.73 | 0.14 |
| 601229.SS | Bank of Shanghai Co Ltd | 4.91 | 0.64 | 0.13 |
| 601818.SS | China Everbright Bank Co Ltd | 5.8 | 0.73 | 0.13 |
| 601916.SS | China Zheshang Bank Co Ltd | 7.06 | 0.72 | 0.11 |
| 6122.HK | Jilin Jiutai Rural Commercial Bank Corp Ltd | 2.09 | 0.75 | 0.29 |
| 9668.HK | China Bohai Bank Co Ltd | 32.08 | 0.96 | 0.04 |
| AXISBANK.NS | Axis Bank Ltd | 0.58 | 1.29 | 0.89 |
| EMIRATESNBD.DB | Emirates NBD Bank PJSC | 0.6 | 1.2 | 0.82 |
| Low | High | |
| Unlevered beta | 0.13 | 0.18 |
| Relevered beta | 0.93 | 1.24 |
| Adjusted relevered beta | 0.95 | 1.16 |
600015.SS'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 600015.SS:
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.