004380.KS
Samick THK Co Ltd
Price:  
9,960.00 
KRW
Volume:  
25,844.00
Korea, Republic of | Machinery
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004380.KS WACC - Weighted Average Cost of Capital

The WACC of Samick THK Co Ltd (004380.KS) is 8.2%.

The Cost of Equity of Samick THK Co Ltd (004380.KS) is 10.85%.
The Cost of Debt of Samick THK Co Ltd (004380.KS) is 5.90%.

Range Selected
Cost of equity 9.30% - 12.40% 10.85%
Tax rate 16.10% - 18.10% 17.10%
Cost of debt 4.80% - 7.00% 5.90%
WACC 7.0% - 9.5% 8.2%
WACC

004380.KS WACC calculation

Category Low High
Long-term bond rate 3.1% 3.6%
Equity market risk premium 5.8% 6.8%
Adjusted beta 1.07 1.22
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.30% 12.40%
Tax rate 16.10% 18.10%
Debt/Equity ratio 0.78 0.78
Cost of debt 4.80% 7.00%
After-tax WACC 7.0% 9.5%
Selected WACC 8.2%

004380.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 004380.KS:

cost_of_equity (10.85%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.07) + 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.