GTEC WACC - Weighted Average Cost of Capital

The WACC of Greenland Technologies Holding Corp (GTEC) is 7.8%.

The Cost of Equity of Greenland Technologies Holding Corp (GTEC) is 10.05%.

The Cost of Debt of Greenland Technologies Holding Corp (GTEC) is 4.25%.

	Range	Selected
Cost of equity	8.20% - 11.90%	10.05%
Tax rate	9.30% - 13.80%	11.55%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.5% - 9.0%	7.8%

WACC

GTEC WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	0.94	1.25

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	11.90%

Tax rate	9.30%	13.80%
Debt/Equity ratio	0.57	0.57
Cost of debt	4.00%	4.50%

After-tax WACC	6.5%	9.0%


Selected WACC	7.8%

GTEC'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 GTEC:

cost_of_equity (10.05%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.94) + 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.