046890.KQ WACC - Weighted Average Cost of Capital

The WACC of Seoul Semiconductor Co Ltd (046890.KQ) is 10.4%.

The Cost of Equity of Seoul Semiconductor Co Ltd (046890.KQ) is 11.05%.

The Cost of Debt of Seoul Semiconductor Co Ltd (046890.KQ) is 13.85%.

	Range	Selected
Cost of equity	9.10% - 13.00%	11.05%
Tax rate	18.80% - 35.90%	27.35%
Cost of debt	4.60% - 23.10%	13.85%
WACC	7.2% - 13.7%	10.4%

WACC

046890.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	1.04	1.31

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.10%	13.00%

Tax rate	18.80%	35.90%
Debt/Equity ratio	0.55	0.55
Cost of debt	4.60%	23.10%

After-tax WACC	7.2%	13.7%


Selected WACC	10.4%

046890.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 046890.KQ:

cost_of_equity (11.05%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.04) + 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.