The WACC of Seoyon TopMetal Co Ltd (019770.KQ) is 6.5%.
Range | Selected | |
Cost of equity | 5.9% - 8.1% | 7% |
Tax rate | 9.4% - 11.6% | 10.5% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 5.5% - 7.5% | 6.5% |
Category | Low | High |
Long-term bond rate | 3.1% | 3.6% |
Equity market risk premium | 5.8% | 6.8% |
Adjusted beta | 0.48 | 0.59 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 5.9% | 8.1% |
Tax rate | 9.4% | 11.6% |
Debt/Equity ratio | 0.19 | 0.19 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 5.5% | 7.5% |
Selected WACC | 6.5% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
019770.KQ | Seoyon TopMetal Co Ltd | 0.19 | 0.22 | 0.19 |
008830.KQ | DaedongGear | 0.57 | 1.17 | 0.77 |
012280.KS | Yeonghwa Metal Co Ltd | 1.94 | 0.35 | 0.13 |
024120.KQ | KB Autosys Co Ltd | 2.2 | 0.29 | 0.1 |
031510.KQ | Austem Co Ltd | 0.95 | 0.35 | 0.19 |
075180.KS | Saeron Automotive Corp | 0.01 | 0.23 | 0.22 |
123700.KS | SJM Co Ltd | 0.22 | 0.59 | 0.5 |
170030.KQ | Hyundai Industrial Co Ltd | 0.07 | 0.83 | 0.78 |
212560.KQ | Neooto Co Ltd | 0.41 | 1.41 | 1.03 |
290120.KQ | Dayou AP Co Ltd | 1.52 | 0.42 | 0.18 |
Low | High | |
Unlevered beta | 0.19 | 0.33 |
Relevered beta | 0.22 | 0.39 |
Adjusted relevered beta | 0.48 | 0.59 |
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 019770.KQ:
cost_of_equity (7.00%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.48) + 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.