603779.SS WACC - Weighted Average Cost of Capital
The WACC of Weilong Grape Wine Co Ltd (603779.SS) is 8.4%.
| Range | Selected | |
| Cost of equity | 6.9% - 10.7% | 8.8% |
| Tax rate | 8.2% - 21.7% | 14.95% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.7% - 10.1% | 8.4% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.69 | 0.99 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.9% | 10.7% |
| Tax rate | 8.2% | 21.7% |
| Debt/Equity ratio | 0.1 | 0.1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.7% | 10.1% |
| Selected WACC | 8.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 603779.SS | Weilong Grape Wine Co Ltd | 0.11 | 0.94 | 0.86 |
| 000995.SZ | Gansu Huangtai Wine-Marketing Industry Co Ltd | 0.02 | 1.47 | 1.44 |
| 389.HK | China Tontine Wines Group Ltd | 0.04 | 0.13 | 0.13 |
| 600059.SS | Zhejiang Guyuelongshan Shaoxing Wine Co Ltd | 0 | 0.97 | 0.97 |
| 600084.SS | Citic Guoan Wine Co Ltd | 0.01 | 1.23 | 1.23 |
| 600365.SS | Tonghua Grape Wine Co Ltd | 0.18 | 0.74 | 0.64 |
| 600543.SS | Gansu Mogao Industrial Development Co Ltd | 0.03 | 0.29 | 0.28 |
| 600616.SS | Shanghai Jinfeng Wine Co Ltd | 0.02 | 1.02 | 1 |
| 8146.HK | Grace Wine Holdings Ltd | 0.47 | -0.31 | -0.22 |
| BKV.SI | Dukang Distillers Holdings Ltd | 0.33 | -0.98 | -0.76 |
| Low | High | |
| Unlevered beta | 0.5 | 0.9 |
| Relevered beta | 0.54 | 0.99 |
| Adjusted relevered beta | 0.69 | 0.99 |
603779.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 603779.SS:
cost_of_equity (8.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.69) + 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.