CBAT
CBAK Energy Technology Inc
Price:  
0.80 
USD
Volume:  
74,343.00
China | Electrical Equipment
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CBAT WACC - Weighted Average Cost of Capital

The WACC of CBAK Energy Technology Inc (CBAT) is 7.0%.

The Cost of Equity of CBAK Energy Technology Inc (CBAT) is 8.20%.
The Cost of Debt of CBAK Energy Technology Inc (CBAT) is 4.25%.

Range Selected
Cost of equity 6.70% - 9.70% 8.20%
Tax rate 12.20% - 14.10% 13.15%
Cost of debt 4.00% - 4.50% 4.25%
WACC 5.9% - 8.1% 7.0%
WACC

CBAT WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.63 0.86
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.70% 9.70%
Tax rate 12.20% 14.10%
Debt/Equity ratio 0.37 0.37
Cost of debt 4.00% 4.50%
After-tax WACC 5.9% 8.1%
Selected WACC 7.0%

CBAT'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 CBAT:

cost_of_equity (8.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.63) + 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.