000490.KS WACC - Weighted Average Cost of Capital

The WACC of Daedong Industrial Co Ltd (000490.KS) is 12.1%.

The Cost of Equity of Daedong Industrial Co Ltd (000490.KS) is 14.40%.

The Cost of Debt of Daedong Industrial Co Ltd (000490.KS) is 14.50%.

	Range	Selected
Cost of equity	9.50% - 19.30%	14.40%
Tax rate	13.60% - 23.20%	18.40%
Cost of debt	5.90% - 23.10%	14.50%
WACC	6.1% - 18.1%	12.1%

WACC

000490.KS WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	5.8%	6.8%
Adjusted beta	1.11	2.23

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.50%	19.30%

Tax rate	13.60%	23.20%
Debt/Equity ratio	3.77	3.77
Cost of debt	5.90%	23.10%

After-tax WACC	6.1%	18.1%


Selected WACC	12.1%

000490.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 000490.KS:

cost_of_equity (14.40%) = risk_free_rate (3.35%) + equity_risk_premium (6.30%) * adjusted_beta (1.11) + 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.