015760.KS WACC - Weighted Average Cost of Capital
The WACC of Korea Electric Power Corp (015760.KS) is 6.0%.
| Range | Selected | |
| Cost of equity | 8.4% - 11.6% | 10% |
| Tax rate | 29.2% - 30.5% | 29.85% |
| Cost of debt | 4.0% - 11.6% | 7.8% |
| WACC | 3.5% - 8.5% | 6.0% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 0.92 | 1.1 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.4% | 11.6% |
| Tax rate | 29.2% | 30.5% |
| Debt/Equity ratio | 7.58 | 7.58 |
| Cost of debt | 4.0% | 11.6% |
| After-tax WACC | 3.5% | 8.5% |
| Selected WACC | 6.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 015760.KS | Korea Electric Power Corp | 7.58 | 0.38 | 0.06 |
| 005090.KS | SGC Energy Co Ltd | 5.67 | 0.3 | 0.06 |
| 071320.KS | Korea District Heating Corp | 5.46 | -0.22 | -0.05 |
| 5110.SR | Saudi Electricity Company SJSC | 2.42 | 0.9 | 0.33 |
| 9501.T | Tokyo Electric Power Company Holdings Inc | 9.9 | 1.13 | 0.14 |
| 9502.T | Chubu Electric Power Co Inc | 2.32 | 0.6 | 0.23 |
| 9503.T | Kansai Electric Power Co Inc | 2.39 | 0.85 | 0.32 |
| 9506.T | Tohoku Electric Power Co Inc | 6.62 | 0.83 | 0.15 |
| 9508.T | Kyushu Electric Power Co Inc | 6.17 | 0.74 | 0.14 |
| RSTI.ME | Rossiyskiye Seti PAO | 5.03 | 1.1 | 0.24 |
| Low | High | |
| Unlevered beta | 0.14 | 0.18 |
| Relevered beta | 0.88 | 1.15 |
| Adjusted relevered beta | 0.92 | 1.1 |
015760.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 015760.KS:
cost_of_equity (10.00%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.92) + 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.