688011.SS WACC - Weighted Average Cost of Capital
The WACC of Harbin Xinguang Optic-Electronics Technology Co Ltd (688011.SS) is 10.8%.
| Range | Selected | |
| Cost of equity | 9.1% - 12.5% | 10.8% |
| Tax rate | 15.5% - 21.0% | 18.25% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 9.1% - 12.4% | 10.8% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.06 | 1.24 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.1% | 12.5% |
| Tax rate | 15.5% | 21.0% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 9.1% | 12.4% |
| Selected WACC | 10.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 688011.SS | Harbin Xinguang Optic-Electronics Technology Co Ltd | 0.01 | 1.59 | 1.58 |
| 002161.SZ | Invengo Information Technology Co Ltd | 0.15 | 0.85 | 0.76 |
| 002546.SZ | Nanjing Xinlian Electronics Co Ltd | 0.03 | 1.08 | 1.05 |
| 002972.SZ | Shenzhen Keanda Electronic Technology Corp Ltd | 0.02 | 0.98 | 0.96 |
| 300202.SZ | Julong Co Ltd | 0.66 | 1.65 | 1.07 |
| 300449.SZ | Beijing Hanbang Technology Corp | 0.04 | 1.12 | 1.08 |
| 300480.SZ | GL Tech Co Ltd | 0.08 | 1.73 | 1.62 |
| 300902.SZ | Guoanda Co Ltd | 0 | 1.79 | 1.79 |
| 300906.SZ | Jiangxi Everbright Measurement and Control Technology Co Ltd | 0.01 | 1.36 | 1.35 |
| 688312.SS | Shenzhen Yanmade Technology Inc | 0.02 | 1.37 | 1.34 |
| Low | High | |
| Unlevered beta | 1.08 | 1.35 |
| Relevered beta | 1.09 | 1.36 |
| Adjusted relevered beta | 1.06 | 1.24 |
688011.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 688011.SS:
cost_of_equity (10.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.06) + 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.