603990.SS WACC - Weighted Average Cost of Capital
The WACC of Suzhou MedicalSystem Technology Co Ltd (603990.SS) is 8.1%.
| Range | Selected | |
| Cost of equity | 6.8% - 12.3% | 9.55% |
| Tax rate | 11.9% - 14.3% | 13.1% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.1% - 10.1% | 8.1% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.67 | 1.2 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.8% | 12.3% |
| Tax rate | 11.9% | 14.3% |
| Debt/Equity ratio | 0.38 | 0.38 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.1% | 10.1% |
| Selected WACC | 8.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 603990.SS | Suzhou MedicalSystem Technology Co Ltd | 0.09 | 1.3 | 1.2 |
| 071200.KQ | Infinitt Healthcare Co Ltd | 0.02 | 0.19 | 0.18 |
| 1ST.AX | 1st Group Ltd | 0.39 | -1.81 | -1.36 |
| 2158.HK | Yidu Tech Inc | 0.02 | 1.56 | 1.54 |
| 300288.SZ | Guiyang Longmaster Information & Technology Co Ltd | 0.01 | 1.69 | 1.68 |
| 300451.SZ | B-SOFT Co Ltd | 0.01 | 2.08 | 2.06 |
| 300550.SZ | Heren Health Co Ltd | 0.03 | 1.02 | 0.99 |
| 4480.T | Medley Inc | 0.16 | 0.57 | 0.5 |
| 600767.SS | Winsan Chengdu Medical Science and Technology Co Ltd | 0.23 | 0.26 | 0.22 |
| GLH.AX | Global Health Ltd | 0.22 | -0.43 | -0.36 |
| Low | High | |
| Unlevered beta | 0.39 | 1.08 |
| Relevered beta | 0.51 | 1.3 |
| Adjusted relevered beta | 0.67 | 1.2 |
603990.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 603990.SS:
cost_of_equity (9.55%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.67) + 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.