039610.KQ
HS Valve Co Ltd
Price:  
11,380 
KRW
Volume:  
1,193,437
Korea, Republic of | Machinery

039610.KQ WACC - Weighted Average Cost of Capital

The WACC of HS Valve Co Ltd (039610.KQ) is 8.0%.

The Cost of Equity of HS Valve Co Ltd (039610.KQ) is 8.95%.
The Cost of Debt of HS Valve Co Ltd (039610.KQ) is 4.25%.

RangeSelected
Cost of equity7.4% - 10.5%8.95%
Tax rate12.5% - 16.8%14.65%
Cost of debt4.0% - 4.5%4.25%
WACC6.7% - 9.3%8.0%
WACC

039610.KQ WACC calculation

CategoryLowHigh
Long-term bond rate3.1%3.6%
Equity market risk premium5.8%6.8%
Adjusted beta0.740.95
Additional risk adjustments0.0%0.5%
Cost of equity7.4%10.5%
Tax rate12.5%16.8%
Debt/Equity ratio
0.230.23
Cost of debt4.0%4.5%
After-tax WACC6.7%9.3%
Selected WACC8.0%

039610.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 039610.KQ:

cost_of_equity (8.95%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.74) + 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.