084850.KQ WACC - Weighted Average Cost of Capital

The WACC of ITM Semiconductor Co Ltd (084850.KQ) is 10.9%.

The Cost of Equity of ITM Semiconductor Co Ltd (084850.KQ) is 12.55%.

The Cost of Debt of ITM Semiconductor Co Ltd (084850.KQ) is 13.70%.

	Range	Selected
Cost of equity	10.60% - 14.50%	12.55%
Tax rate	19.90% - 35.80%	27.85%
Cost of debt	4.30% - 23.10%	13.70%
WACC	7.2% - 14.6%	10.9%

WACC

084850.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	1.29	1.52

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.60%	14.50%

Tax rate	19.90%	35.80%
Debt/Equity ratio	0.92	0.92
Cost of debt	4.30%	23.10%

After-tax WACC	7.2%	14.6%


Selected WACC	10.9%

084850.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 084850.KQ:

cost_of_equity (12.55%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.29) + 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.