688388.SS
Guangdong JiaYuan Technology Shares Co Ltd
Price:  
17.54 
CNY
Volume:  
5,128,483
China | Electrical Equipment

688388.SS WACC - Weighted Average Cost of Capital

The WACC of Guangdong JiaYuan Technology Shares Co Ltd (688388.SS) is 9.0%.

The Cost of Equity of Guangdong JiaYuan Technology Shares Co Ltd (688388.SS) is 11.95%.
The Cost of Debt of Guangdong JiaYuan Technology Shares Co Ltd (688388.SS) is 5%.

RangeSelected
Cost of equity10.5% - 13.4%11.95%
Tax rate13.0% - 15.3%14.15%
Cost of debt5.0% - 5.0%5%
WACC8.1% - 9.9%9.0%
WACC

688388.SS WACC calculation

CategoryLowHigh
Long-term bond rate2.7%3.2%
Equity market risk premium6.1%7.1%
Adjusted beta1.281.37
Additional risk adjustments0.0%0.5%
Cost of equity10.5%13.4%
Tax rate13.0%15.3%
Debt/Equity ratio
0.630.63
Cost of debt5.0%5.0%
After-tax WACC8.1%9.9%
Selected WACC9.0%

688388.SS WACC - Detailed calculations of Beta

LowHigh
Unlevered beta0.971.05
Relevered beta1.421.55
Adjusted relevered beta1.281.37

688388.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 688388.SS:

cost_of_equity (11.95%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (1.28) + 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.