688689.SS
Changzhou Galaxy Century Microelectronics Co Ltd
Price:  
21.45 
CNY
Volume:  
993,309.00
China | Semiconductors & Semiconductor Equipment
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688689.SS WACC - Weighted Average Cost of Capital

The WACC of Changzhou Galaxy Century Microelectronics Co Ltd (688689.SS) is 11.2%.

The Cost of Equity of Changzhou Galaxy Century Microelectronics Co Ltd (688689.SS) is 12.25%.
The Cost of Debt of Changzhou Galaxy Century Microelectronics Co Ltd (688689.SS) is 5.00%.

Range Selected
Cost of equity 10.50% - 14.00% 12.25%
Tax rate 10.30% - 10.80% 10.55%
Cost of debt 5.00% - 5.00% 5.00%
WACC 9.7% - 12.8% 11.2%
WACC

688689.SS WACC calculation

Category Low High
Long-term bond rate 2.7% 3.2%
Equity market risk premium 6.1% 7.1%
Adjusted beta 1.28 1.45
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.50% 14.00%
Tax rate 10.30% 10.80%
Debt/Equity ratio 0.16 0.16
Cost of debt 5.00% 5.00%
After-tax WACC 9.7% 12.8%
Selected WACC 11.2%

688689.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 688689.SS:

cost_of_equity (12.25%) = 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.