034590.KS
Incheon City Gas Co Ltd
Price:  
24,900 
KRW
Volume:  
2,550
Korea, Republic of | Gas Utilities

034590.KS WACC - Weighted Average Cost of Capital

The WACC of Incheon City Gas Co Ltd (034590.KS) is 7.1%.

The Cost of Equity of Incheon City Gas Co Ltd (034590.KS) is 7.75%.
The Cost of Debt of Incheon City Gas Co Ltd (034590.KS) is 4.25%.

RangeSelected
Cost of equity6.7% - 8.8%7.75%
Tax rate20.9% - 22.1%21.5%
Cost of debt4.0% - 4.5%4.25%
WACC6.2% - 8.1%7.1%
WACC

034590.KS WACC calculation

CategoryLowHigh
Long-term bond rate3.1%3.6%
Equity market risk premium5.8%6.8%
Adjusted beta0.630.7
Additional risk adjustments0.0%0.5%
Cost of equity6.7%8.8%
Tax rate20.9%22.1%
Debt/Equity ratio
0.170.17
Cost of debt4.0%4.5%
After-tax WACC6.2%8.1%
Selected WACC7.1%

034590.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 034590.KS:

cost_of_equity (7.75%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.63) + 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.