600033.SS WACC - Weighted Average Cost of Capital
The WACC of Fujian Expressway Development Co Ltd (600033.SS) is 8.1%.
| Range | Selected | |
| Cost of equity | 7.1% - 10.5% | 8.8% |
| Tax rate | 26.4% - 26.8% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.7% - 9.6% | 8.1% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.72 | 0.95 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.1% | 10.5% |
| Tax rate | 26.4% | 26.8% |
| Debt/Equity ratio | 0.14 | 0.14 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.7% | 9.6% |
| Selected WACC | 8.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 600033.SS | Fujian Expressway Development Co Ltd | 0.14 | 0.63 | 0.57 |
| 000548.SZ | Hunan Investment Group Co Ltd | 0.08 | 1.2 | 1.14 |
| 000828.SZ | Dongguan Development Holdings Co Ltd | 0.64 | 1.18 | 0.8 |
| 002023.SZ | Sichuan Haite High-tech Co Ltd | 0.29 | 1.29 | 1.06 |
| 1576.HK | Qilu Expressway Co Ltd | 2.89 | 0.29 | 0.09 |
| 1785.HK | Chengdu Expressway Co Ltd | 0.76 | 0.31 | 0.2 |
| 300424.SZ | Guangzhou Hangxin Aviation Technology Co Ltd | 0.26 | 1.97 | 1.66 |
| 600012.SS | Anhui Expressway Co Ltd | 0.29 | 0.37 | 0.3 |
| 600106.SS | Chongqing Road and Bridge Co Ltd | 0.21 | 1.03 | 0.9 |
| 600368.SS | Guangxi Wuzhou Communications Co Ltd | 0.35 | 0.58 | 0.46 |
| Low | High | |
| Unlevered beta | 0.53 | 0.84 |
| Relevered beta | 0.58 | 0.93 |
| Adjusted relevered beta | 0.72 | 0.95 |
600033.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 600033.SS:
cost_of_equity (8.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.72) + 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.