603355.SS WACC - Weighted Average Cost of Capital
The WACC of Kingclean Electric Co Ltd (603355.SS) is 8.8%.
| Range | Selected | |
| Cost of equity | 9.4% - 12.3% | 10.85% |
| Tax rate | 7.9% - 9.5% | 8.7% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.9% - 9.8% | 8.8% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.1 | 1.21 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.4% | 12.3% |
| Tax rate | 7.9% | 9.5% |
| Debt/Equity ratio | 0.48 | 0.48 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.9% | 9.8% |
| Selected WACC | 8.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 603355.SS | Kingclean Electric Co Ltd | 0.48 | 0.73 | 0.51 |
| 002035.SZ | Vatti Corp Ltd | 0.29 | 1.14 | 0.9 |
| 002543.SZ | Guangdong Vanward New Electric Co Ltd | 0.2 | 1.03 | 0.87 |
| 002616.SZ | Guangdong Chant Group Inc | 1.41 | 1.02 | 0.45 |
| 002668.SZ | Guangdong Homa Group Co Ltd | 0.46 | 0.68 | 0.48 |
| 002677.SZ | Zhejiang Meida Industrial Co Ltd | 0 | 1.09 | 1.09 |
| 002681.SZ | Shenzhen Fenda Technology Co Ltd | 0.1 | 1.69 | 1.55 |
| 002959.SZ | Bear Electric Appliance Co Ltd | 0.28 | 1.45 | 1.15 |
| 600336.SS | Aucma Co Ltd | 0.51 | 1.03 | 0.7 |
| 600983.SS | Whirlpool China Co Ltd | 0.12 | 1.03 | 0.93 |
| Low | High | |
| Unlevered beta | 0.8 | 0.91 |
| Relevered beta | 1.15 | 1.31 |
| Adjusted relevered beta | 1.1 | 1.21 |
603355.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 603355.SS:
cost_of_equity (10.85%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.1) + 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.