243840.KQ WACC - Weighted Average Cost of Capital

The WACC of Shin Heung Energy & Electronics Co Ltd (243840.KQ) is 10.1%.

The Cost of Equity of Shin Heung Energy & Electronics Co Ltd (243840.KQ) is 12.85%.

The Cost of Debt of Shin Heung Energy & Electronics Co Ltd (243840.KQ) is 9.50%.

	Range	Selected
Cost of equity	11.20% - 14.50%	12.85%
Tax rate	8.60% - 13.30%	10.95%
Cost of debt	4.10% - 14.90%	9.50%
WACC	6.6% - 13.5%	10.1%

WACC

243840.KQ WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	1.39	1.53

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.20%	14.50%

Tax rate	8.60%	13.30%
Debt/Equity ratio	1.59	1.59
Cost of debt	4.10%	14.90%

After-tax WACC	6.6%	13.5%


Selected WACC	10.1%

243840.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 243840.KQ:

cost_of_equity (12.85%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.39) + 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.