8413.HK WACC - Weighted Average Cost of Capital

The WACC of Asia Grocery Distribution Ltd (8413.HK) is 7.8%.

The Cost of Equity of Asia Grocery Distribution Ltd (8413.HK) is 5.60%.

The Cost of Debt of Asia Grocery Distribution Ltd (8413.HK) is 27.60%.

	Range	Selected
Cost of equity	4.90% - 6.30%	5.60%
Tax rate	7.80% - 22.70%	15.25%
Cost of debt	4.30% - 50.90%	27.60%
WACC	4.7% - 10.9%	7.8%

WACC

8413.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.34	0.35

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.90%	6.30%

Tax rate	7.80%	22.70%
Debt/Equity ratio	0.16	0.16
Cost of debt	4.30%	50.90%

After-tax WACC	4.7%	10.9%


Selected WACC	7.8%

8413.HK'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 8413.HK:

cost_of_equity (5.60%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.34) + 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.