108320.KQ WACC - Weighted Average Cost of Capital

The WACC of Silicon Works Co Ltd (108320.KQ) is 11.3%.

The Cost of Equity of Silicon Works Co Ltd (108320.KQ) is 11.40%.

The Cost of Debt of Silicon Works Co Ltd (108320.KQ) is 4.30%.

	Range	Selected
Cost of equity	9.20% - 13.60%	11.40%
Tax rate	21.80% - 22.30%	22.05%
Cost of debt	4.00% - 4.60%	4.30%
WACC	9.2% - 13.5%	11.3%

WACC

108320.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	6.2%	7.2%
Adjusted beta	0.86	1.2

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.20%	13.60%

Tax rate	21.80%	22.30%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	4.60%

After-tax WACC	9.2%	13.5%


Selected WACC	11.3%

108320.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 108320.KQ:

cost_of_equity (11.40%) = risk_free_rate (4.15%) + equity_risk_premium (6.70%) * adjusted_beta (0.86) + 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.