043340.KQ WACC - Weighted Average Cost of Capital
The WACC of Essen Tech Co Ltd (043340.KQ) is 11.6%.
| Range | Selected | |
| Cost of equity | 10.3% - 13.8% | 12.05% |
| Tax rate | 4.3% - 9.8% | 7.05% |
| Cost of debt | 4.1% - 20.1% | 12.1% |
| WACC | 7.5% - 15.7% | 11.6% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 1.24 | 1.42 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.3% | 13.8% |
| Tax rate | 4.3% | 9.8% |
| Debt/Equity ratio | 0.79 | 0.79 |
| Cost of debt | 4.1% | 20.1% |
| After-tax WACC | 7.5% | 15.7% |
| Selected WACC | 11.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 043340.KQ | Essen Tech Co Ltd | 0.79 | 0.48 | 0.27 |
| 011700.KS | Hanshin Machinery Co Ltd | 0.07 | 1.55 | 1.46 |
| 049430.KQ | Komelon Corp | 0 | 1.03 | 1.03 |
| 083660.KQ | CSA Cosmic Co Ltd | 0.06 | 0.94 | 0.89 |
| 096350.KQ | Daechang Solution Co Ltd | 0.98 | 0.93 | 0.48 |
| 100660.KQ | Seoam Machinery Industry Co Ltd | 0 | 0.62 | 0.62 |
| 101170.KQ | Woorim Machinery Co Ltd | 0 | 0.94 | 0.94 |
| 117730.KQ | T-Robotics Co Ltd | 0.16 | 1.57 | 1.36 |
| 119500.KQ | Formetal Co Ltd | 0.11 | 0.68 | 0.61 |
| 217820.KQ | NS Co Ltd | 1.1 | 1.89 | 0.93 |
| Low | High | |
| Unlevered beta | 0.78 | 0.93 |
| Relevered beta | 1.36 | 1.63 |
| Adjusted relevered beta | 1.24 | 1.42 |
043340.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 043340.KQ:
cost_of_equity (12.05%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.24) + 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.