603767.SS WACC - Weighted Average Cost of Capital
The WACC of Zhejiang Zomax Transmission Co Ltd (603767.SS) is 8.9%.
| Range | Selected | |
| Cost of equity | 11.3% - 14.7% | 13% |
| Tax rate | 6.1% - 6.7% | 6.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.0% - 9.7% | 8.9% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.41 | 1.55 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.3% | 14.7% |
| Tax rate | 6.1% | 6.7% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.0% | 9.7% |
| Selected WACC | 8.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 603767.SS | Zhejiang Zomax Transmission Co Ltd | 1.09 | 1.3 | 0.65 |
| 002265.SZ | Yunnan Xiyi Industrial Co Ltd | 0.08 | 0.91 | 0.85 |
| 002865.SZ | Hainan Drinda Automotive Trim Co Ltd | 0.64 | 1.54 | 0.96 |
| 003033.SZ | Qingdao CHOHO Industrial Co Ltd | 0.14 | 0.75 | 0.66 |
| 2488.HK | Launch Tech Co Ltd | 0.35 | 0.1 | 0.08 |
| 600148.SS | Changchun Yidong Clutch Co Ltd | 0.09 | 0.52 | 0.48 |
| 603006.SS | Shanghai Lianming Machinery Co Ltd | 0.02 | 1.53 | 1.5 |
| 603089.SS | ADD Industry Zhejiang Co Ltd | 0.49 | 1.05 | 0.72 |
| 603335.SS | Guangdong Dcenti Auto-Parts Stock Ltd Co | 0.42 | 1.3 | 0.93 |
| 603922.SS | Suzhou Jin Hong Shun Auto Parts Co Ltd | 0.12 | 1.14 | 1.03 |
| 605128.SS | Shanghai Yanpu Metal Products Co Ltd | 0.08 | 1.12 | 1.04 |
| Low | High | |
| Unlevered beta | 0.72 | 0.93 |
| Relevered beta | 1.61 | 1.82 |
| Adjusted relevered beta | 1.41 | 1.55 |
603767.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 603767.SS:
cost_of_equity (13.00%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.41) + 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.