540404.BO WACC - Weighted Average Cost of Capital

The WACC of Prime Fresh Ltd (540404.BO) is 14.6%.

The Cost of Equity of Prime Fresh Ltd (540404.BO) is 12.60%.

The Cost of Debt of Prime Fresh Ltd (540404.BO) is 97.10%.

	Range	Selected
Cost of equity	10.70% - 14.50%	12.60%
Tax rate	26.60% - 26.80%	26.70%
Cost of debt	7.50% - 186.70%	97.10%
WACC	10.5% - 18.7%	14.6%

WACC

540404.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.46	0.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.70%	14.50%

Tax rate	26.60%	26.80%
Debt/Equity ratio	0.04	0.04
Cost of debt	7.50%	186.70%

After-tax WACC	10.5%	18.7%


Selected WACC	14.6%

540404.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 540404.BO:

cost_of_equity (12.60%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.46) + 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.