605100.SS WACC - Weighted Average Cost of Capital
The WACC of Power HF Co Ltd (605100.SS) is 9.4%.
| Range | Selected | |
| Cost of equity | 8.2% - 11.2% | 9.7% |
| Tax rate | 17.0% - 17.8% | 17.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.0% - 10.8% | 9.4% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.9 | 1.06 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.2% | 11.2% |
| Tax rate | 17.0% | 17.8% |
| Debt/Equity ratio | 0.06 | 0.06 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.0% | 10.8% |
| Selected WACC | 9.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 605100.SS | Power HF Co Ltd | 0.06 | 0.68 | 0.65 |
| 000816.SZ | Jiangsu Nonghua Intelligent Agriculture Technology Co Ltd | 0.09 | 1.57 | 1.46 |
| 002523.SZ | Zhuzhou Tianqiao Crane Co Ltd | 0.11 | 1.19 | 1.09 |
| 1596.HK | Hebei Yichen Industrial Group Corp Ltd | 0.33 | -0.11 | -0.08 |
| 300103.SZ | Dagang Holding Group Co Ltd | 0.07 | 1.13 | 1.07 |
| 600262.SS | Inner Mongolia North Hauler Joint Stock Co Ltd | 0.21 | 0.8 | 0.68 |
| 600495.SS | Jinxi Axle Co Ltd | 0.05 | 0.65 | 0.63 |
| 603966.SS | Eurocrane China Co Ltd | 0.26 | 1.22 | 1.01 |
| 605001.SS | Qingdao Victall Railway Co Ltd | 0.46 | 1.25 | 0.9 |
| 688569.SS | Beijing Tieke Shougang Railway Tech Co Ltd | 0.02 | 1.16 | 1.14 |
| Low | High | |
| Unlevered beta | 0.81 | 1.03 |
| Relevered beta | 0.85 | 1.09 |
| Adjusted relevered beta | 0.9 | 1.06 |
605100.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 605100.SS:
cost_of_equity (9.70%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.9) + 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.