530077.BO WACC - Weighted Average Cost of Capital

The WACC of Freshtrop Fruits Ltd (530077.BO) is 13.5%.

The Cost of Equity of Freshtrop Fruits Ltd (530077.BO) is 13.85%.

The Cost of Debt of Freshtrop Fruits Ltd (530077.BO) is 7.05%.

	Range	Selected
Cost of equity	12.40% - 15.30%	13.85%
Tax rate	25.60% - 27.70%	26.65%
Cost of debt	7.00% - 7.10%	7.05%
WACC	12.1% - 15.0%	13.5%

WACC

530077.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.66	0.8

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.40%	15.30%

Tax rate	25.60%	27.70%
Debt/Equity ratio	0.04	0.04
Cost of debt	7.00%	7.10%

After-tax WACC	12.1%	15.0%


Selected WACC	13.5%

530077.BO'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 530077.BO:

cost_of_equity (13.85%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.66) + 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.