600151.SS
Shanghai Aerospace Automobile Electromechanical Co Ltd
Price:  
7.1 
CNY
Volume:  
16,155,569
China | Auto Components

600151.SS WACC - Weighted Average Cost of Capital

The WACC of Shanghai Aerospace Automobile Electromechanical Co Ltd (600151.SS) is 9.9%.

The Cost of Equity of Shanghai Aerospace Automobile Electromechanical Co Ltd (600151.SS) is 11.05%.
The Cost of Debt of Shanghai Aerospace Automobile Electromechanical Co Ltd (600151.SS) is 5%.

RangeSelected
Cost of equity9.7% - 12.4%11.05%
Tax rate27.8% - 41.7%34.75%
Cost of debt5.0% - 5.0%5%
WACC8.8% - 11.0%9.9%
WACC

600151.SS WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta1.151.22
Additional risk adjustments0.0%0.5%
Cost of equity9.7%12.4%
Tax rate27.8%41.7%
Debt/Equity ratio
0.170.17
Cost of debt5.0%5.0%
After-tax WACC8.8%11.0%
Selected WACC9.9%

600151.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 600151.SS:

cost_of_equity (11.05%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.15) + 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.