The WACC of I&C Technology Co Ltd (052860.KQ) is 9.7%.
| Range | Selected | |
| Cost of equity | 10.00% - 13.50% | 11.75% |
| Tax rate | 0.10% - 1.10% | 0.60% |
| Cost of debt | 4.00% - 7.00% | 5.50% |
| WACC | 8.1% - 11.4% | 9.7% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 1.19 | 1.39 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.00% | 13.50% |
| Tax rate | 0.10% | 1.10% |
| Debt/Equity ratio | 0.48 | 0.48 |
| Cost of debt | 4.00% | 7.00% |
| After-tax WACC | 8.1% | 11.4% |
| Selected WACC | 9.7% | |
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 052860.KQ:
cost_of_equity (11.75%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.19) + 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.