603587.SS WACC - Weighted Average Cost of Capital
The WACC of Dazzle Fashion Co Ltd (603587.SS) is 9.2%.
| Range | Selected | |
| Cost of equity | 8.1% - 10.8% | 9.45% |
| Tax rate | 25.2% - 25.9% | 25.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.9% - 10.5% | 9.2% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.88 | 1 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.1% | 10.8% |
| Tax rate | 25.2% | 25.9% |
| Debt/Equity ratio | 0.04 | 0.04 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.9% | 10.5% |
| Selected WACC | 9.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 603587.SS | Dazzle Fashion Co Ltd | 0.04 | 0.93 | 0.9 |
| 002003.SZ | Zhejiang Weixing Industrial Development Co Ltd | 0.06 | 0.35 | 0.34 |
| 002699.SZ | Meisheng Cultural & Creative Corp Ltd | 0.66 | 0.94 | 0.63 |
| 002832.SZ | BIEM.L .FDLKK Garment Co Ltd | 0.09 | 1.84 | 1.73 |
| 1234.HK | China Lilang Ltd | 0.33 | 0.44 | 0.35 |
| 300577.SZ | Anhui Korrun Co Ltd | 0.29 | 1.26 | 1.04 |
| 3306.HK | JNBY Design Ltd | 0.05 | 0.56 | 0.54 |
| 3818.HK | China Dongxiang (Group) Co Ltd | 0.02 | 1.24 | 1.23 |
| 600400.SS | Jiangsu Hongdou Industrial Co Ltd | 0.27 | 1.1 | 0.91 |
| 601566.SS | Joeone Co Ltd | 0.17 | 1.16 | 1.03 |
| Low | High | |
| Unlevered beta | 0.79 | 0.96 |
| Relevered beta | 0.82 | 1 |
| Adjusted relevered beta | 0.88 | 1 |
603587.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 603587.SS:
cost_of_equity (9.45%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.88) + 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.