085370.KQ
Lutronic Corp
Price:  
36,700 
KRW
Volume:  
8,362
Korea, Republic of | Health Care Equipment & Supplies

085370.KQ WACC - Weighted Average Cost of Capital

The WACC of Lutronic Corp (085370.KQ) is 7.8%.

The Cost of Equity of Lutronic Corp (085370.KQ) is 7.8%.
The Cost of Debt of Lutronic Corp (085370.KQ) is 4.25%.

RangeSelected
Cost of equity6.6% - 9.0%7.8%
Tax rate18.8% - 24.6%21.7%
Cost of debt4.0% - 4.5%4.25%
WACC6.6% - 9.0%7.8%
WACC

085370.KQ WACC calculation

CategoryLowHigh
Long-term bond rate3.1%3.6%
Equity market risk premium5.8%6.8%
Adjusted beta0.610.73
Additional risk adjustments0.0%0.5%
Cost of equity6.6%9.0%
Tax rate18.8%24.6%
Debt/Equity ratio
00
Cost of debt4.0%4.5%
After-tax WACC6.6%9.0%
Selected WACC7.8%

085370.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 085370.KQ:

cost_of_equity (7.80%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.61) + 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.