600318.SS
Anhui Xinli Finance Co Ltd
Price:  
9.85 
CNY
Volume:  
54,528,400
China | Consumer Finance

600318.SS WACC - Weighted Average Cost of Capital

The WACC of Anhui Xinli Finance Co Ltd (600318.SS) is 5.4%.

The Cost of Equity of Anhui Xinli Finance Co Ltd (600318.SS) is 6.1%.
The Cost of Debt of Anhui Xinli Finance Co Ltd (600318.SS) is 5%.

RangeSelected
Cost of equity4.9% - 7.3%6.1%
Tax rate33.8% - 39.5%36.65%
Cost of debt5.0% - 5.0%5%
WACC4.5% - 6.3%5.4%
WACC

600318.SS WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta0.370.5
Additional risk adjustments0.0%0.5%
Cost of equity4.9%7.3%
Tax rate33.8%39.5%
Debt/Equity ratio
0.310.31
Cost of debt5.0%5.0%
After-tax WACC4.5%6.3%
Selected WACC5.4%

600318.SS WACC - Detailed calculations of Beta

LowHigh
Unlevered beta0.110.21
Relevered beta0.060.25
Adjusted relevered beta0.370.5

600318.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 600318.SS:

cost_of_equity (6.10%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.37) + 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.