The WACC of MiCo Ltd (059090.KQ) is 9.3%.
| Range | Selected | |
| Cost of equity | 15.50% - 19.80% | 17.65% |
| Tax rate | 30.90% - 40.70% | 35.80% |
| Cost of debt | 4.00% - 7.00% | 5.50% |
| WACC | 8.0% - 10.6% | 9.3% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 2.14 | 2.31 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 15.50% | 19.80% |
| Tax rate | 30.90% | 40.70% |
| Debt/Equity ratio | 1.42 | 1.42 |
| Cost of debt | 4.00% | 7.00% |
| After-tax WACC | 8.0% | 10.6% |
| Selected WACC | 9.3% | |
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 059090.KQ:
cost_of_equity (17.65%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (2.14) + 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.