096770.KS WACC - Weighted Average Cost of Capital
The WACC of SK Innovation Co Ltd (096770.KS) is 4.6%.
| Range | Selected | |
| Cost of equity | 6.4% - 9.7% | 8.05% |
| Tax rate | 29.0% - 36.4% | 32.7% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 3.7% - 5.6% | 4.6% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 0.58 | 0.82 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.4% | 9.7% |
| Tax rate | 29.0% | 36.4% |
| Debt/Equity ratio | 3.54 | 3.54 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 3.7% | 5.6% |
| Selected WACC | 4.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 096770.KS | SK Innovation Co Ltd | 3.54 | 1.35 | 0.4 |
| 002960.KS | Hankook Shell Oil Co Ltd | 0 | 0.26 | 0.26 |
| 003650.KS | Michang Oil Ind Co Ltd | 0.3 | 0.09 | 0.08 |
| 010950.KS | S-Oil Corp | 1.34 | 0.83 | 0.44 |
| 060900.KQ | Daehan Green Power Corp | 0.23 | 0.13 | 0.11 |
| 137950.KQ | JC Chemical Corp Ltd | 1.69 | 0.62 | 0.29 |
| 2380.SR | Rabigh Refining and Petrochemical Company SJSC | 2.73 | 0.31 | 0.11 |
| 5017.T | Fuji Oil Co Ltd | 6.13 | 1.11 | 0.22 |
| HENGYUAN.KL | Hengyuan Refining Company Bhd | 2.64 | 0.18 | 0.07 |
| JNOS.ME | Slavneft' Yaroslavnefteorgsintez PAO | 0.8 | 0.02 | 0.01 |
| Low | High | |
| Unlevered beta | 0.11 | 0.24 |
| Relevered beta | 0.37 | 0.73 |
| Adjusted relevered beta | 0.58 | 0.82 |
096770.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 096770.KS:
cost_of_equity (8.05%) = 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.