600637.SS
Oriental Pearl Group Co Ltd
Price:  
7.59 
CNY
Volume:  
62,973,652
China | Media

600637.SS WACC - Weighted Average Cost of Capital

The WACC of Oriental Pearl Group Co Ltd (600637.SS) is 9.1%.

The Cost of Equity of Oriental Pearl Group Co Ltd (600637.SS) is 9.55%.
The Cost of Debt of Oriental Pearl Group Co Ltd (600637.SS) is 5%.

RangeSelected
Cost of equity7.7% - 11.4%9.55%
Tax rate24.8% - 29.9%27.35%
Cost of debt5.0% - 5.0%5%
WACC7.4% - 10.8%9.1%
WACC

600637.SS WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta0.821.08
Additional risk adjustments0.0%0.5%
Cost of equity7.7%11.4%
Tax rate24.8%29.9%
Debt/Equity ratio
0.090.09
Cost of debt5.0%5.0%
After-tax WACC7.4%10.8%
Selected WACC9.1%

600637.SS WACC - Detailed calculations of Beta

LowHigh
Unlevered beta0.691.06
Relevered beta0.731.12
Adjusted relevered beta0.821.08

600637.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 600637.SS:

cost_of_equity (9.55%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.82) + 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.