006050.KQ WACC - Weighted Average Cost of Capital

The WACC of Kuk Young G M (006050.KQ) is 6.1%.

The Cost of Equity of Kuk Young G M (006050.KQ) is 6.80%.

The Cost of Debt of Kuk Young G M (006050.KQ) is 4.25%.

	Range	Selected
Cost of equity	5.80% - 7.80%	6.80%
Tax rate	23.30% - 26.90%	25.10%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.3% - 6.9%	6.1%

WACC

006050.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	0.46	0.55

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.80%	7.80%

Tax rate	23.30%	26.90%
Debt/Equity ratio	0.24	0.24
Cost of debt	4.00%	4.50%

After-tax WACC	5.3%	6.9%


Selected WACC	6.1%

006050.KQ'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 006050.KQ:

cost_of_equity (6.80%) = 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.