600784.SS
Luyin Investment Group Co Ltd
Price:  
6.36 
CNY
Volume:  
14,465,180
China | Metals & Mining

600784.SS WACC - Weighted Average Cost of Capital

The WACC of Luyin Investment Group Co Ltd (600784.SS) is 8.0%.

The Cost of Equity of Luyin Investment Group Co Ltd (600784.SS) is 9.4%.
The Cost of Debt of Luyin Investment Group Co Ltd (600784.SS) is 5%.

RangeSelected
Cost of equity8.3% - 10.5%9.4%
Tax rate10.7% - 14.4%12.55%
Cost of debt5.0% - 5.0%5%
WACC7.3% - 8.8%8.0%
WACC

600784.SS WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta0.920.95
Additional risk adjustments0.0%0.5%
Cost of equity8.3%10.5%
Tax rate10.7%14.4%
Debt/Equity ratio
0.380.38
Cost of debt5.0%5.0%
After-tax WACC7.3%8.8%
Selected WACC8.0%

600784.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 600784.SS:

cost_of_equity (9.40%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.92) + 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.