037400.KQ WACC - Weighted Average Cost of Capital

The WACC of Wooree Lighting Co Ltd (037400.KQ) is 8.3%.

The Cost of Equity of Wooree Lighting Co Ltd (037400.KQ) is 27.20%.

The Cost of Debt of Wooree Lighting Co Ltd (037400.KQ) is 4.70%.

	Range	Selected
Cost of equity	22.50% - 31.90%	27.20%
Tax rate	19.80% - 23.10%	21.45%
Cost of debt	4.60% - 4.80%	4.70%
WACC	7.3% - 9.2%	8.3%

WACC

037400.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	3.34	4.09

Additional risk adjustments	0.0%	0.5%
Cost of equity	22.50%	31.90%

Tax rate	19.80%	23.10%
Debt/Equity ratio	4.16	4.16
Cost of debt	4.60%	4.80%

After-tax WACC	7.3%	9.2%


Selected WACC	8.3%

037400.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 037400.KQ:

cost_of_equity (27.20%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (3.34) + 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.