069960.KS WACC - Weighted Average Cost of Capital
The WACC of Hyundai Department Store Co Ltd (069960.KS) is 5.0%.
| Range | Selected | |
| Cost of equity | 6.5% - 8.3% | 7.4% |
| Tax rate | 25.0% - 25.0% | 25% |
| Cost of debt | 4.0% - 5.3% | 4.65% |
| WACC | 4.4% - 5.7% | 5.0% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 0.58 | 0.62 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.5% | 8.3% |
| Tax rate | 25.0% | 25.0% |
| Debt/Equity ratio | 1.52 | 1.52 |
| Cost of debt | 4.0% | 5.3% |
| After-tax WACC | 4.4% | 5.7% |
| Selected WACC | 5.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 069960.KS | Hyundai Department Store Co Ltd | 1.52 | 0.39 | 0.18 |
| 002419.SZ | Rainbow Digital Commercial Co Ltd | 1.99 | 1.17 | 0.47 |
| 004170.KS | Shinsegae Inc | 3.03 | 0.59 | 0.18 |
| 006370.KS | Daegu Department Store Co Ltd | 3.32 | -0.02 | -0.01 |
| 019010.KQ | VenueG Co Ltd | 1.92 | 0.41 | 0.17 |
| 023530.KS | Lotte Shopping Co Ltd | 6.73 | 0.43 | 0.07 |
| 037710.KS | GwangjuShinsegae Co Ltd | 1.27 | 0.32 | 0.16 |
| 067830.KS | Savezone I&C Corp | 0.18 | 0.47 | 0.41 |
| 600828.SS | Maoye Commercial Co Ltd | 0.81 | 1.06 | 0.66 |
| 601366.SS | Liqun Commercial Group Co Ltd | 1.98 | 0.58 | 0.23 |
| Low | High | |
| Unlevered beta | 0.18 | 0.2 |
| Relevered beta | 0.37 | 0.43 |
| Adjusted relevered beta | 0.58 | 0.62 |
069960.KS'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 069960.KS:
cost_of_equity (7.40%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.58) + 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.