603088.SS
JDM JingDa Machine Ningbo Co Ltd
Price:  
9.02 
CNY
Volume:  
5,677,100
China | Machinery

603088.SS WACC - Weighted Average Cost of Capital

The WACC of JDM JingDa Machine Ningbo Co Ltd (603088.SS) is 9.7%.

The Cost of Equity of JDM JingDa Machine Ningbo Co Ltd (603088.SS) is 9.8%.
The Cost of Debt of JDM JingDa Machine Ningbo Co Ltd (603088.SS) is 5%.

RangeSelected
Cost of equity8.5% - 11.1%9.8%
Tax rate13.3% - 13.6%13.45%
Cost of debt5.0% - 5.0%5%
WACC8.4% - 11.0%9.7%
WACC

603088.SS WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta0.941.04
Additional risk adjustments0.0%0.5%
Cost of equity8.5%11.1%
Tax rate13.3%13.6%
Debt/Equity ratio
0.020.02
Cost of debt5.0%5.0%
After-tax WACC8.4%11.0%
Selected WACC9.7%

603088.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 603088.SS:

cost_of_equity (9.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.94) + 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.