540404.BO WACC - Weighted Average Cost of Capital

The WACC of Prime Fresh Ltd (540404.BO) is 16.0%.

The Cost of Equity of Prime Fresh Ltd (540404.BO) is 15.00%.

The Cost of Debt of Prime Fresh Ltd (540404.BO) is 95.20%.

	Range	Selected
Cost of equity	13.50% - 16.50%	15.00%
Tax rate	26.90% - 27.50%	27.20%
Cost of debt	7.50% - 182.90%	95.20%
WACC	13.3% - 18.6%	16.0%

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	0.79	0.93

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.50%	16.50%

Tax rate	26.90%	27.50%
Debt/Equity ratio	0.02	0.02
Cost of debt	7.50%	182.90%

After-tax WACC	13.3%	18.6%


Selected WACC	16.0%

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 (15.00%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.79) + 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.