603226.SS WACC - Weighted Average Cost of Capital
The WACC of Vohringer Home Technology Co Ltd (603226.SS) is 8.0%.
| Range | Selected | |
| Cost of equity | 7.0% - 9.4% | 8.2% |
| Tax rate | 16.5% - 20.9% | 18.7% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.8% - 9.1% | 8.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.7 | 0.8 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.0% | 9.4% |
| Tax rate | 16.5% | 20.9% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.8% | 9.1% |
| Selected WACC | 8.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 603226.SS | Vohringer Home Technology Co Ltd | 0.06 | 1.12 | 1.07 |
| 002084.SZ | Guangzhou Seagull Kitchen and Bath Products Co Ltd | 0.53 | 0.82 | 0.57 |
| 002205.SZ | XinJiang GuoTong Pipeline Co Ltd | 1.3 | 0.92 | 0.44 |
| 1937.HK | Jiachen Holding Group Ltd | 0.34 | 0.38 | 0.3 |
| 600202.SS | Harbin Air Conditioning Co Ltd | 0.65 | 0.82 | 0.53 |
| 600444.SS | Sinomach General Machinery Science & Technology Co Ltd | 0.03 | 1.05 | 1.02 |
| 600876.SS | Luoyang Glass Co Ltd | 1.31 | 1.11 | 0.53 |
| 603311.SS | Zhejiang Goldensea Hi Tech Co Ltd | 0.08 | 0.89 | 0.84 |
| 603616.SS | Beijing Hanjian Heshan Pipeline Co Ltd | 0.28 | 1.06 | 0.86 |
| 8646.HK | China Hongguang Holdings Ltd | 0.59 | -0.69 | -0.47 |
| Low | High | |
| Unlevered beta | 0.53 | 0.68 |
| Relevered beta | 0.55 | 0.7 |
| Adjusted relevered beta | 0.7 | 0.8 |
603226.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 603226.SS:
cost_of_equity (8.20%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.7) + 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.