600645.SS WACC - Weighted Average Cost of Capital
The WACC of Vcanbio Cell & Gene Engineering Corp Ltd (600645.SS) is 9.2%.
| Range | Selected | |
| Cost of equity | 8.0% - 10.4% | 9.2% |
| Tax rate | 31.8% - 33.0% | 32.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.0% - 10.3% | 9.2% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.87 | 0.94 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.0% | 10.4% |
| Tax rate | 31.8% | 33.0% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.0% | 10.3% |
| Selected WACC | 9.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 600645.SS | Vcanbio Cell & Gene Engineering Corp Ltd | 0.01 | 1 | 0.99 |
| 002038.SZ | Beijing SL Pharmaceutical Co Ltd | 0 | 1.25 | 1.25 |
| 002880.SZ | Shenzhen Weiguang Biological Products Co Ltd | 0.11 | 0.9 | 0.84 |
| 1672.HK | Ascletis Pharma Inc | 0 | 0.86 | 0.86 |
| 300294.SZ | Boya Bio-pharmaceutical Group Co Ltd | 0.02 | 0.77 | 0.76 |
| 300639.SZ | Guangdong Hybribio Biotech Co Ltd | 0.02 | 1.66 | 1.63 |
| 603387.SS | Getein Biotech Inc | 0.14 | 1.23 | 1.12 |
| 688198.SS | Beijing Balance Medical Technology Co Ltd | 0 | 0.73 | 0.73 |
| 688278.SS | Xiamen Amoytop Biotech Co Ltd | 0 | 0.45 | 0.45 |
| 688336.SS | Sunshine Guojian Pharmaceutical Shanghai Co Ltd | 0 | 0.67 | 0.67 |
| Low | High | |
| Unlevered beta | 0.81 | 0.91 |
| Relevered beta | 0.81 | 0.91 |
| Adjusted relevered beta | 0.87 | 0.94 |
600645.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 600645.SS:
cost_of_equity (9.20%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.87) + 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.