601518.SS WACC - Weighted Average Cost of Capital
The WACC of Jilin Expressway Co Ltd (601518.SS) is 8.9%.
| Range | Selected | |
| Cost of equity | 8.2% - 10.4% | 9.3% |
| Tax rate | 23.1% - 24.2% | 23.65% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.9% - 9.8% | 8.9% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.91 | 0.94 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.2% | 10.4% |
| Tax rate | 23.1% | 24.2% |
| Debt/Equity ratio | 0.09 | 0.09 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.9% | 9.8% |
| Selected WACC | 8.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 601518.SS | Jilin Expressway Co Ltd | 0.01 | 0.88 | 0.88 |
| 000548.SZ | Hunan Investment Group Co Ltd | 0.08 | 1.2 | 1.13 |
| 000828.SZ | Dongguan Development Holdings Co Ltd | 0.62 | 1.17 | 0.79 |
| 1576.HK | Qilu Expressway Co Ltd | 1.9 | 0.31 | 0.13 |
| 1785.HK | Chengdu Expressway Co Ltd | 0.79 | 0.31 | 0.2 |
| 300424.SZ | Guangzhou Hangxin Aviation Technology Co Ltd | 0.25 | 2.04 | 1.71 |
| 600106.SS | Chongqing Road and Bridge Co Ltd | 0.21 | 1.04 | 0.89 |
| 600368.SS | Guangxi Wuzhou Communications Co Ltd | 0.35 | 0.6 | 0.48 |
| 601188.SS | Heilongjiang Transport Development Co Ltd | 0.03 | 0.84 | 0.82 |
| META.JK | Nusantara Infrastructure Tbk PT | 0.11 | 1.35 | 1.24 |
| Low | High | |
| Unlevered beta | 0.81 | 0.88 |
| Relevered beta | 0.87 | 0.91 |
| Adjusted relevered beta | 0.91 | 0.94 |
601518.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 601518.SS:
cost_of_equity (9.30%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.91) + 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.