229640.KS
LS Cable & System Asia Ltd
Price:  
32,600 
KRW
Volume:  
97,002
Korea, Republic of | Electrical Equipment

229640.KS WACC - Weighted Average Cost of Capital

The WACC of LS Cable & System Asia Ltd (229640.KS) is 8.4%.

The Cost of Equity of LS Cable & System Asia Ltd (229640.KS) is 9.35%.
The Cost of Debt of LS Cable & System Asia Ltd (229640.KS) is 4.65%.

RangeSelected
Cost of equity8.0% - 10.7%9.35%
Tax rate30.1% - 39.6%34.85%
Cost of debt4.1% - 5.2%4.65%
WACC7.2% - 9.6%8.4%
WACC

229640.KS WACC calculation

CategoryLowHigh
Long-term bond rate3.1%3.6%
Equity market risk premium5.8%6.8%
Adjusted beta0.840.98
Additional risk adjustments0.0%0.5%
Cost of equity8.0%10.7%
Tax rate30.1%39.6%
Debt/Equity ratio
0.170.17
Cost of debt4.1%5.2%
After-tax WACC7.2%9.6%
Selected WACC8.4%

229640.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 229640.KS:

cost_of_equity (9.35%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (0.84) + 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.