601568.SS WACC - Weighted Average Cost of Capital
The WACC of Shaanxi Beiyuan Chemical Industry Group Co Ltd (601568.SS) is 9.1%.
| Range | Selected | |
| Cost of equity | 8.0% - 10.6% | 9.3% |
| Tax rate | 13.7% - 15.1% | 14.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.8% - 10.3% | 9.1% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.86 | 0.97 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.0% | 10.6% |
| Tax rate | 13.7% | 15.1% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.8% | 10.3% |
| Selected WACC | 9.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 601568.SS | Shaanxi Beiyuan Chemical Industry Group Co Ltd | 0.05 | 0.89 | 0.85 |
| 000990.SZ | Chengzhi Co Ltd | 0.7 | 1.19 | 0.74 |
| 002648.SZ | Zhejiang Satellite Petrochemical Co Ltd | 0.49 | 1.03 | 0.73 |
| 002709.SZ | Guangzhou Tinci Materials Technology Co Ltd | 0.21 | 1.88 | 1.6 |
| 600160.SS | Zhejiang Juhua Co Ltd | 0.07 | 1.09 | 1.03 |
| 600299.SS | Bluestar Adisseo Co | 0.05 | 0.7 | 0.67 |
| 601118.SS | China Hainan Rubber Industry Group Co Ltd | 0.98 | 0.98 | 0.53 |
| 601216.SS | Inner Mongolia Junzheng Energy & Chemical Group Co Ltd | 0.18 | 1.57 | 1.36 |
| 603077.SS | Sichuan Hebang Biotechnology Co Ltd | 0.56 | 1.17 | 0.79 |
| 603737.SS | Skshu Paint Co Ltd | 0.25 | 1.48 | 1.22 |
| Low | High | |
| Unlevered beta | 0.77 | 0.92 |
| Relevered beta | 0.79 | 0.96 |
| Adjusted relevered beta | 0.86 | 0.97 |
601568.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 601568.SS:
cost_of_equity (9.30%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.86) + 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.