The WACC of Vidente Co Ltd (121800.KQ) is 10.0%.
| Range | Selected | |
| Cost of equity | 8.90% - 12.00% | 10.45% |
| Tax rate | 12.50% - 19.00% | 15.75% |
| Cost of debt | 4.50% - 7.00% | 5.75% |
| WACC | 8.5% - 11.6% | 10.0% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 0.99 | 1.17 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.90% | 12.00% |
| Tax rate | 12.50% | 19.00% |
| Debt/Equity ratio | 0.08 | 0.08 |
| Cost of debt | 4.50% | 7.00% |
| After-tax WACC | 8.5% | 11.6% |
| Selected WACC | 10.0% | |
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 121800.KQ:
cost_of_equity (10.45%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.99) + 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.