600117.SS
Xining Special Steel Co Ltd
Price:  
2.33 
CNY
Volume:  
34,542,476
China | Metals & Mining

600117.SS WACC - Weighted Average Cost of Capital

The WACC of Xining Special Steel Co Ltd (600117.SS) is 6.7%.

The Cost of Equity of Xining Special Steel Co Ltd (600117.SS) is 7.5%.
The Cost of Debt of Xining Special Steel Co Ltd (600117.SS) is 5%.

RangeSelected
Cost of equity5.5% - 9.5%7.5%
Tax rate1.7% - 2.3%2%
Cost of debt5.0% - 5.0%5%
WACC5.3% - 8.0%6.7%
WACC

600117.SS WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta0.450.81
Additional risk adjustments0.0%0.5%
Cost of equity5.5%9.5%
Tax rate1.7%2.3%
Debt/Equity ratio
0.460.46
Cost of debt5.0%5.0%
After-tax WACC5.3%8.0%
Selected WACC6.7%

600117.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 600117.SS:

cost_of_equity (7.50%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.45) + 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.