037230.KQ WACC - Weighted Average Cost of Capital

The WACC of Hankuk Package Co Ltd (037230.KQ) is 5.8%.

The Cost of Equity of Hankuk Package Co Ltd (037230.KQ) is 7.45%.

The Cost of Debt of Hankuk Package Co Ltd (037230.KQ) is 6.30%.

	Range	Selected
Cost of equity	6.10% - 8.80%	7.45%
Tax rate	20.60% - 28.20%	24.40%
Cost of debt	5.90% - 6.70%	6.30%
WACC	5.3% - 6.4%	5.8%

WACC

037230.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	0.53	0.7

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.10%	8.80%

Tax rate	20.60%	28.20%
Debt/Equity ratio	1.52	1.52
Cost of debt	5.90%	6.70%

After-tax WACC	5.3%	6.4%


Selected WACC	5.8%

037230.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 037230.KQ:

cost_of_equity (7.45%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.53) + 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.