PLIN
China Xiangtai Food Co Ltd
Price:  
1.15 
USD
Volume:  
193,184
China | Food Products

PLIN WACC - Weighted Average Cost of Capital

The WACC of China Xiangtai Food Co Ltd (PLIN) is 6.8%.

The Cost of Equity of China Xiangtai Food Co Ltd (PLIN) is 6.85%.
The Cost of Debt of China Xiangtai Food Co Ltd (PLIN) is 5.5%.

RangeSelected
Cost of equity5.1% - 8.6%6.85%
Tax rate8.0% - 11.2%9.6%
Cost of debt4.0% - 7.0%5.5%
WACC5.0% - 8.6%6.8%
WACC

PLIN WACC calculation

CategoryLowHigh
Long-term bond rate3.2%3.7%
Equity market risk premium4.2%5.2%
Adjusted beta0.330.76
Additional risk adjustments0.5%1.0%
Cost of equity5.1%8.6%
Tax rate8.0%11.2%
Debt/Equity ratio
0.020.02
Cost of debt4.0%7.0%
After-tax WACC5.0%8.6%
Selected WACC6.8%

PLIN'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 PLIN:

cost_of_equity (6.85%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (0.33) + risk_adjustments (0.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.