The WACC of IM Co Ltd (101390.KQ) is 8.9%.
| Range | Selected | |
| Cost of equity | 11.40% - 19.10% | 15.25% |
| Tax rate | 17.00% - 24.40% | 20.70% |
| Cost of debt | 7.00% - 8.40% | 7.70% |
| WACC | 7.5% - 10.3% | 8.9% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 1.42 | 2.2 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.40% | 19.10% |
| Tax rate | 17.00% | 24.40% |
| Debt/Equity ratio | 2.22 | 2.22 |
| Cost of debt | 7.00% | 8.40% |
| After-tax WACC | 7.5% | 10.3% |
| Selected WACC | 8.9% | |
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 101390.KQ:
cost_of_equity (15.25%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.42) + 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.