540405.BO WACC - Weighted Average Cost of Capital

The WACC of Oceanic Foods Ltd (540405.BO) is 13.8%.

The Cost of Equity of Oceanic Foods Ltd (540405.BO) is 15.90%.

The Cost of Debt of Oceanic Foods Ltd (540405.BO) is 10.75%.

	Range	Selected
Cost of equity	14.30% - 17.50%	15.90%
Tax rate	24.60% - 25.80%	25.20%
Cost of debt	8.10% - 13.40%	10.75%
WACC	12.1% - 15.5%	13.8%

WACC

540405.BO WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.89	1.03

Additional risk adjustments	0.0%	0.5%
Cost of equity	14.30%	17.50%

Tax rate	24.60%	25.80%
Debt/Equity ratio	0.37	0.37
Cost of debt	8.10%	13.40%

After-tax WACC	12.1%	15.5%


Selected WACC	13.8%

540405.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 540405.BO:

cost_of_equity (15.90%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.89) + 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.