016100.KQ WACC - Weighted Average Cost of Capital

The WACC of Leaders Cosmetics Co Ltd (016100.KQ) is 8.8%.

The Cost of Equity of Leaders Cosmetics Co Ltd (016100.KQ) is 11.50%.

The Cost of Debt of Leaders Cosmetics Co Ltd (016100.KQ) is 5.50%.

	Range	Selected
Cost of equity	9.20% - 13.80%	11.50%
Tax rate	24.10% - 37.40%	30.75%
Cost of debt	4.00% - 7.00%	5.50%
WACC	7.1% - 10.5%	8.8%

WACC

016100.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	1.05	1.43

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.20%	13.80%

Tax rate	24.10%	37.40%
Debt/Equity ratio	0.53	0.53
Cost of debt	4.00%	7.00%

After-tax WACC	7.1%	10.5%


Selected WACC	8.8%

016100.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 016100.KQ:

cost_of_equity (11.50%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.05) + 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.