002870.KS WACC - Weighted Average Cost of Capital
The WACC of Shinpoong Paper MFG Co Ltd (002870.KS) is 6.6%.
| Range | Selected | |
| Cost of equity | 5.8% - 7.6% | 6.7% |
| Tax rate | 25.0% - 25.0% | 25% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 5.6% - 7.5% | 6.6% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 0.46 | 0.52 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.8% | 7.6% |
| Tax rate | 25.0% | 25.0% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 5.6% | 7.5% |
| Selected WACC | 6.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002870.KS | Shinpoong Paper MFG Co Ltd | 0.05 | -0.33 | -0.31 |
| 002200.KS | Korea Export Packaging Industrial Co Ltd | 0.01 | 0.28 | 0.27 |
| 005820.KS | Wonlim Corp | 0.23 | 0.56 | 0.47 |
| 009460.KS | Hanchang Paper Co Ltd | 3.22 | 0.59 | 0.17 |
| 014160.KS | Daeyoung Packaging Co Ltd | 0.11 | -0.44 | -0.41 |
| 014970.KQ | Samryoong | 0.4 | 1.57 | 1.21 |
| 017650.KQ | Daelim Paper | 0.06 | 0.16 | 0.16 |
| 023600.KQ | Sambo Corrugated Board Co Ltd | 0.53 | 0.52 | 0.37 |
| 027970.KS | Seha Corp | 1.31 | 0.4 | 0.2 |
| 037230.KQ | Hankuk Package Co Ltd | 1.4 | 0.54 | 0.26 |
| Low | High | |
| Unlevered beta | 0.19 | 0.27 |
| Relevered beta | 0.19 | 0.28 |
| Adjusted relevered beta | 0.46 | 0.52 |
002870.KS'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 002870.KS:
cost_of_equity (6.70%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.46) + 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.